The festive season spending in South Africa officially began on Black Friday, continuing throughout the past weekend and into Cyber Monday.
The country’s top banks have reported an increase in spending.
First National Bank (FNB) said that on Black Friday, customers made purchases worth over R3 billion.
Standard Bank South Africa said that on Black Friday, customer transactions increased almost 19% when compared to the previous year, exceeding the 15% growth recorded in 2021.
Privesan Naidoo, Executive: Trading Products at Nedbank, said: “Nedbank acquiring volumes on Black Friday itself increased by a significant 38% from the levels we saw in 2021.”
Naidoo further said Black Friday weekend 2022 also served to further embed the shift by South African consumers towards digital payments and online shopping.
“Our data reveals a massive year-on-year increase of 88% in online transactions on Black Friday he explains, “whereas the growth in physical purchases rising by 30% on Black Friday.”
FNB said that this year was the highest Black Friday spending reported by the bank in the past four years.
Over R2.4 billion was spent in-store (card-present), whereas over R670 million was for online shopping (card-not-present), FNB said.
FNB Virtual Cards also saw a significant increase, the bank said, accounting for over R137 million in purchases compared to just R36 million during 2021 Black Friday, a 280% increase.
"In a market where consumers are seeing an increase in the cost of living, many were always likely to take advantage of Black Friday deals. As anticipated, the most popular spending categories, including travel and transportation, groceries, clothing, and entertainment, experienced a robust recovery. The increase in travel is especially encouraging given that many consumers were unable to travel in the past few years due to global travel limitations, and it augurs well for the South African economy as the festive season approaches," says Chris Labuschagne, CEO of FNB Card.
Standard Bank says that consumers took advantage of Black Friday deals and made the massive shift to digital and contactless payments, according to the bank’s transaction data over the past weekend.
Standard Bank, South Africa’s largest card issuer, said it saw double-digit volumes of transactions increase in both cards not present and contactless payments over the Black Friday weekend, extending the growth trend in digital payments spurred on by the impact of Covid-19 restrictions.
Customers using contactless payments and tapping their cards at a point of sale has seen a surge in usage of more than 31% when compared to the previous Black Friday weekend, topping the 25% growth the previous year.
Ethel Nyembe, Standard Bank Head of Group Card, says: “Customers are seeing the value that digital payments offer. Safety and convenience are the key factors that have led to the fantastic growth trends we are seeing in online and contactless payments. And this convenience is continuing to evolve.”
Standard Bank saw a 20% increase in the number of transactions processed over the weekend when compared to the year before and a 22.5% increase in the value of purchases over the same period.
Volumes increased to 8.6 million transactions processed over the weekend.
Nyembe says: “Customers have been very selective this year. The high interest rate environment continued muted growth in the economy, and valuable lessons learnt from previous economic shock cycles have made consumers far more selective and cautious when taking on debt. We continue to urge customers to shop responsibly as we exit the Black Friday weekend and head into the festive season.”
Other notable trends evident from the data gleaned from Nedbank’s transactional platforms include the following:
- Spend levels by age group remained relatively similar, with consumers in their 20s, 30s and 40s accounting for the vast majority of transactions.
- The biggest increase in spend proportion was seen amongst consumers in their 30s, which increased from 21% of total spend across Nedbank channels in 2021 to 27% in 2022.
- The three most popular spend categories amongst consumers on Black Friday weekend were groceries and food, general shopping, and clothing, followed closely by fuel, alcohol, and furniture.
- In line with the above statistics, supermarkets emerged as the merchants that enjoyed the most support from consumers, with Pick n Pay, Checkers and Superspar taking the top three spots in terms of overall transaction values.
Despite the significant increase in transaction volumes and values, real time payments (RTC) increased in excess of 100% this year at Nedbank.
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