Fitness and self care; clothing; and entertainment are the things that South African consumers are spending their money on in December and over the festive season.
Spending for charity or donation tends to peak in April, possibly around Easter when charitable giving is encouraged, according to Standard Bank who revealed seasonal spending trends for SA consumers.
For January and February, education related expenses peak with back-to-school costs. Education costs can also spike in July as students prepare for the second semester.
Fitness and self-care spending peaks in December which can be attributed to New Year’s resolutions and holiday-related self-care.
There is also an increase in spend for clothing in December due to the festive season and holiday shopping.
In December and January, entertainment spending peaks in line with the festive season.
In terms of expenses for holiday and travel there isn't the same strong peak during the festive season which is likely due to travel being planned and paid for throughout the year, rather than being concentrated in the final quarter.
Standard Bank said that over the past three years, the spending patterns in SA have remained relatively stable, with customers allocating similar portions of their total spend towards essential expense like groceries, transport, digital connectivity, and entertainment, as they did in 2022.
However, certain changes in spending habits are becoming more evident and reflect the ongoing economic pressures that many households are facing.
Data from Standard Bank that tracks the spending patterns of its retail customers, shows a decline in household spending on charity, donations, healthcare, insurance, family and home-related expenses such as home improvements and furnishings.
“Interestingly, transport costs have remained stable, despite fuel price hikes in the past three years, possibly due to ongoing hybrid work arrangements or adjustments in commuting habits to save on transport-related costs," Shené Mothilal, Solution Owner of Digital Money Manager, Standard Bank said.
“This data shows that, despite tough economic conditions, South Africans remain resilient."
Rising interest and digital payments
A key trend in the data is the rising share of spending going towards the payment of interest due to the SA prime interest rate that has been on the rise since late 2021, until the first 25 basis point cut in September, and another reduction in November.
According to Mothilal, another significant shift is the rise in digital payments, as cash withdrawals continue to decrease.
“Consumers are increasingly turning to digital payment methods, in particular cellphone payments like instant money, for convenience," Mothilal said.