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Nedbank Says There’s Shift in Consumer Spending Trends

December 2, 2023

Nedbank has said that it observed a significant shift in trends in consumer spending behavior during the recent Black Friday period. The Bank said that this points to the continual evolution of South Africa’s retail landscape, and a greater awareness by South Africans of the importance of sound personal financial principles.

Decline in Card Transaction Volumes

According to data reported by BankservAfrica, the South African banking industry experienced a 6% decline in Black Friday card transaction volumes.

Yusuf Hassen, Head of Product Management Card at BankservAfrica, expressed that while this decline may initially seem concerning, it is essential to understand the broader context influencing consumer behaviour.

He says, “Financial constraints faced by consumers were clearly visible in this year’s Black Friday spending patterns, Hassen notes,“and we are also mindful that promotions extended throughout the month of November, which could have resulted in the muted figures for Black Friday itself.”

Possible Reasons for Transaction Data

According to Hassen, Black Friday spending could have been impacted by the fact that it fell on the 24th of November, as opposed to the 25th that is the usual South African pay day.

Executive Trading Product VP at Nedbank explained that Black Friday delivered mixed data in terms of transaction volumes and values.

Despite a decrease in physical card transactions, there was a continuation of the shift towards e-commerce, evidenced by a robust 35% growth in online payment transactions.

Nedbank’s own data also reveals a pattern that appears to bear out Hassen’s opinion about the payday mis-timing of Black Friday. The bank saw a slight decline in the growth of volume and value of transactions on the day itself, followed by a significant recovery over the weekend.

Sharp Rise in Contactless Payments

Nedbank’s issuing base mirrored this trend, remaining flat year-on-year but showing a strong weekend recovery into Cyber Monday. Notably, e-commerce transactions involving Nedbank and American Express cards increased on Black Friday.

“The trend towards contactless payments is particularly encouraging, demonstrating a 47% volume increase and a staggering 93% value growth compared to 2021,” says Naidoo, highlighting the fact that this was not a passing fad relating to the pandemic, but rather that consumers now recognise the convenience and security that these contactless transactions offer.”

Data shows shift towards mindful spending

The highest number of transactions by a single Nedbank cardholder on Black Friday dropped significantly, coming in at 64 in 2023, compared to 100 in 2022.

It was further observed that this datapoint is indicative of a broader trend observed by Nedbank towards more discerning and mindful spending by consumers.

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry

Stephen Linnell is The New BankservAfrica CEO

September 18, 2023

Interbank payments provider BankservAfrica has appointed Stephen Linnell as its new CEO, replacing Jan Pilbauer, who left the organisation in April. BankservAfrica, which plays an integral role in the smooth functioning of South Africa’s economy, and which led the recent launch of PayShap, South Africa’s digital rapid payments platform, said Linnell will take the reins on 1 October.

“Stephen’s credentials as a dynamic executive across a wide range of disciplines is impeccable,” BankservAfrica board chairman Teddy Daka said in a statement on Monday.

“His passion for the development of financial market infrastructure is evident and we are confident of Stephen’s expertise and ability to lead BankservAfrica in its journey towards the envisioned platform future state.”

Linnell was previously both chief operating officer and chief information officer for global markets at Rand Merchant Bank. He also has experience leading wholesale securities and payments businesses for both RMB and Absa, and has held board level positions at other financial markets infrastructure providers.

On Pilbauer’s exit, BankservAfrica said: “Jan played a pivotal role in transitioning BankservAfrica to be recognised as an influential force in the industry through the delivery of PayShap, and in steering the organisation’s vision towards its modernised, future state.”