An honouring fee at Standard Bank is a charge you might see on your account when there isn't quite enough money to cover a transaction, but the bank decides to "honour" or allow the payment to go through anyway. Instead of declining the transaction, which could lead to its own set of problems, the bank covers the shortfall.

Simply put, the Standard Bank honouring fee is generally R100. However, if the amount of the transaction that is honoured is less than R100, the fee charged will be equal to the full value of that transaction. For example, if a debit order for R50 goes off and you only have R20, the bank might honour the R50 payment, and in this case, the honouring fee would be R50.

Why Standard Bank Charges an Honouring Fee

You might wonder why a bank would charge you for essentially helping you out. The main reason Standard Bank has an honouring fee is to prevent a transaction from being declined due to insufficient funds. When a transaction is declined, it can lead to various issues, like late payment penalties from the company trying to debit your account, or even damage to your credit record if it's an important payment like a loan instalment. By honouring the payment, the bank helps you avoid these immediate negative consequences.

I remember one time, I completely forgot about a small streaming service subscription debit order. It was only about R80, but my account was a bit low that month. Standard Bank honoured it, and while I saw the R80 honouring fee pop up, I was actually quite relieved it went through. It saved me the hassle of dealing with a cancelled subscription and remembering to reactivate it. It's a small fee compared to the potential headache!

It's important to note that honouring fees mainly apply to certain types of transactions, especially debit orders.

Avoiding Honouring Fees

No one likes unexpected bank charges, and honouring fees are no different. Here are some straightforward ways to keep them off your statement:

• Keep a Close Eye on Your Balance: This might sound obvious, but regularly checking your bank balance is your best defense. Use the Standard Bank app, online banking, or even cellphone banking (*120*2345#) to stay updated.
• Set Up Notifications: Standard Bank offers in-app notifications and SMS alerts for transactions. Turning these on can give you a heads-up if your balance is getting low or if a large debit order is about to go off.
• Understand Your Debit Orders: Make a list of all your recurring payments and their dates. Sometimes, a debit order might go off a day or two earlier than you expect, catching you off guard.
• Consider an Overdraft Facility: If you find yourself frequently running a little short, an overdraft facility can act as a safety net. It's a pre-approved limit you can go into, and while there are fees for using it, it can sometimes be more predictable than honouring fees.
• Link a Savings Account: If you have a savings account with Standard Bank, linking it to your current account can sometimes allow funds to be automatically transferred to cover shortfalls, preventing honouring fees.

I have a friend who used to get hit by honouring fees quite often. He had a few small debit orders for things like gym and a monthly donation, and sometimes his payday would shift slightly, causing issues. He was always so frustrated by the R100 charges. Eventually, I showed him how to set up alerts on his banking app, and it made a huge difference. He also moved his debit order dates to just after his salary usually clears. It took a little effort, but now he rarely sees those fees.

Staying on top of your bank account means you can avoid these charges and keep more of your money where it belongs - in your pocket.

Managing your bank fees is a smart move, and just like finding ways to save on banking, the Points Castle App can help you earn rewards and free vouchers, giving you more financial flexibility.