Four South African banking heavyweights, Standard Bank, First National Bank (FNB), Absa and Nedbank, are contesting for the tender to manage banking transactions of the Gauteng government, with a 2015 budget estimated at more than R90-billion, Gauteng Provincial Treasury (GPT) revealed on Friday.

The winner of the five-year tender would also be responsible for the payment of salaries to 200 000 officials and monthly supplier payments of about R3-billion, explained the GPT when announcing the bidders.

Gauteng Finance MEC Barbara Creecy announced in January that the department was searching for a new bank to manage the provincial government’s multibillion-rand centralised banking services account, as the current contract with FNB would expire end-2016.

In an effort to secure the bid, Standard Bank offered free access to Internet banking, which provided transactional history enquiries, balance enquiries, scheduled exports of transaction history, the restoration of archived/deleted batches, stop cheque enquiries and the ability to search transaction detail and recipients payment history.

However, the bank asked R30 for bank charges and transaction fees in real-time gross settlements for payments less than R5-million.

In contrast, FNB offered all the services requested in the tender for free, but charged R1.37 for Internet banking access.

Other categories that would be considered before awarding the tender included a current account key charge, monthly service fees per bank account, cash deposits, online banking, bank account verification fees, host-to-host payment and collection services and bank charges and transaction fees.

While the black economic-empowered Absa, which ranked highest with a level 3 status, charged R499 for its monthly online banking access, along with R27 a user, it was unlikely to compete further in the tender, as its tax certificate had expired in November last year.

Each bank would also need strict internal controls to prevent and detect fraud.

Speaking to Engineering News Online, GPT MEC spokesperson John Sukazi said the tender process for the contract was a pilot for “open tenders”. The tender process was open to the public as the Gauteng Finance Department wanted to be more transparent with the public.

“Everyone who wanted to see how [the tender process works] was welcome to attend. This was the first part in terms of the tender process,” he said.

From here, the tenders would be evaluated by the Bid Evaluation Committee, which would meet seven times before March 27.

The committee would then make a recommendation to the Bid Adjudication Committee, which would meet on April 8. The final deliberations would also be open to the public.

It was anticipated that the tender would be awarded by mid-year to allow the GPT a 12-month transition and implementation period. The successful bidder would then start providing its services on April 1, 2016.

In a previous statement, Creecy said that the department aimed to use its relationship with the winning institution to invest in the township economy by availing financial, as well as nonfinancial, assistance to small business owners.

“The successful bidder will also work with us to increase the financial literacy of our employees and invest in community programmes to improve the living conditions of our people,” she added.