Absa is closing its Money Market Fund and investment experts are not impressed.Investment experts are questioning Absa’s decision to close its Money Market Fund as the decision will lock in customers who follow the bank’s advice to move their money to an Absa fixed deposit account, while they will also pay higher fees.
“It is the first time ever that this happens. It is absolute rubbish that Absa is closing the fund because people are using it as a bank account. Absa now wants customers to convert their investments to a fixed deposit,” Heystek said He also points out that Daniel Mminele, CEO of Absa since January 2020, worked at the South African Reserve Bank for 20 years where he served as deputy governor for two five-year terms.Why is Absa really closing its Money Market Fund?
Economist Mike Schüssler says as the country’s biggest money market fund, it was seen as safe and good, with many people, especially older people, investing because they often prefer safety more than growth. “The findings of the review are not inconsistent with our previous notifications to our clients, which reiterated that the fund was a unit trust and that capital and returns were not guaranteed.”