Clients in Uproar as EasyEquities Unveils New ‘Thrive Fee

Clients in Uproar as EasyEquities Unveils New ‘Thrive Fee

EasyEquities, the nation’s largest retail broker, is facing a backlash from dissatisfied clients due to their mishandled communication regarding a significant change set to be implemented in November. This change effectively introduces a monthly platform fee of R25 for non-regular customers.

Customers who make regular deposits and investments will generally be exempt from this fee. However, the communication to clients regarding this exemption is not immediately clear.

The fee will be introduced through a new loyalty program called “Thrive.” All account holders have been automatically enrolled in this loyalty program, and there is no option to opt out without closing your account.

Many clients have expressed their discontent with this change on social media platforms, with some criticizing it as unnecessarily complex and poorly communicated. One prominent social media user referred to it as “disingenuous.”

To avoid the fee, EasyEquities clients can engage in various activities on the platform that will elevate their status to different levels. Clients at level three or higher will not be subject to the “Thrive Fee.” Additionally, investors under the age of 21 or over 65 are exempt.

The simplest way to reach level three and bypass the R25 monthly fee is by depositing more funds than you withdraw (net) in a given month, earning three “Thrive levels progress.” Referring a new customer who successfully signs up will also grant you this equivalent level.

There are other activities that can earn you level progress, such as completing the month’s lecture in the EasyEquities Academy or using multiple products like EasyCredit, purchasing bundles or baskets, or utilizing more than one platform like EasyCrypto or EasyProperties.

Frequent users, who are likely already depositing funds regularly, may need to do just a bit more, such as completing the monthly course, to reach level three.

The different levels will provide clients with brokerage discounts on trading “Thrive Stocks” (selected shares and instruments) on the platform in the following month. Level three offers a 30% discount, level four 40%, and so on.

By implementing this change, EasyEquities is aiming to discourage account dormancy and encourage regular fund deposits, as this leads to more transactions. In the event that the fee applies, it will be deducted from the customer’s account with the highest cash balance on the first day of the following month.

The Purple Group CEO, Charles Savage, defended the change, comparing it to being offered a free gym membership that only requires visiting the gym once a month. He believes the change is fair and encourages the right customer behavior.

If a client’s accounts do not have sufficient Free Cash to cover the Thrive Fee, the platform may sell some or all of the client’s investments in the account with the highest net asset value to cover the fee. However, it should be noted that this forced sale would only occur twice a year.

Some customers have suggested that EasyEquities should have simply implemented a straightforward monthly platform fee rather than embedding it in a loyalty program, which some find as complex as Discovery’s Vitality program.

The Purple Group, which owns the platform, is under significant pressure to make EasyEquities profitable, as its shares have experienced a 60% decline this year. The group holds a 70% stake in EasyEquities, with the remaining 30% owned by Sanlam.

Despite challenges, EasyEquities has continued to expand its reach, launching in the Philippines in partnership with GCash and awaiting approval to launch in Kenya. In the first half of the 2023 financial year, Easy Group achieved revenue of R122.6 million but reported a loss before tax of R20.9 million. Activity-driven revenue from transactions declined by 24% during this period.

EasyEquities has faced previous challenges, such as the cancellation of the rollout of scrip lending in 2020 due to issues with changes in terms and communication with clients. The platform recently announced securities-based lending under the EasyCredit product name.


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