South African consumer spending 2023

South Africa's consumer spending habits have been under scrutiny in recent years, particularly with the impacts of the COVID-19 pandemic. A new report, launched by Visa and Discovery Bank, sheds light on the current state of consumer spending in the country. The report, based on data from over 350 million bank cards, $750 billion of spend, and more than 20 billion transactions across four countries, provides valuable insights into how South Africans are managing their finances in the wake of the global health crisis. Hylton Kallner, CEO of Discovery Bank, joined CNBC Africa to delve into the findings of the report and offer his analysis on the trends observed. One of the key themes that emerged from the discussion was the resilience and adaptability of South African consumers in the face of economic challenges. Despite contradictory GDP numbers and high-level economic statistics, the report paints a more nuanced picture of consumer behavior by examining spending patterns before, during, and after COVID-19. Kallner highlighted the importance of understanding where people are allocating their funds on a daily basis to provide context to broader economic indicators. The analysis also delved into the impact of inflation on spending activities, revealing shifts in consumer behavior across various sectors. While grocery inflation remains a significant concern, the rebound in areas such as travel and dining out signifies a positive trend in economic activity. Additionally, the report explored the evolving dynamics of travel expenditure, noting a preference for domestic tourism over international trips. This trend bodes well for the local tourism and hospitality industry, as South Africans rediscover the beauty of traveling within their own country. The report also shed light on the influence of the hybrid working model on spending habits, with a notable increase in online purchases driven by convenience and shifting work arrangements. Furthermore, insights into demographic spending patterns highlighted the growing preference for online shopping among the 31 to 40-year-old age group, signaling a potential shift towards digital transactions in the future. Despite challenges such as fuel price hikes and load shedding impacting consumer behavior, the report suggests a resilient and adaptable consumer base in South Africa. The findings underscore the importance of monitoring consumer spending trends to gain a deeper understanding of the economy and inform strategic decision-making for businesses and policymakers. As South Africa navigates recovery from the pandemic, a comprehensive analysis of consumer behavior will be crucial in shaping the country's economic trajectory.