How South Africans are reshaping their spending habits

South Africans’ spending patterns remained relatively stable over the past three years (2022 to 2024), with most Standard Bank customers allocating similar portions of their total spend towards essential expenses such as groceries, transport, digital connectivity and entertainment.

However, certain shifts in spending habits became more evident, reflecting the economic pressures that many households are facing.

Declining expenditure on charity and family support

Standard Bank’s data, tracking the spending patterns of its retail customers in 2024, showed 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 hybrid work arrangements or adjustments in commuting habits to save on transport-related costs,” says Shené Mothilal, solution owner of Digital Money Manager at Standard Bank.

Rising interest and digital payments 

Looking at South African spending patterns in 2024, Standard Bank noted a key trend in the data: an increasing share of spending going towards interest payments.

This comes as no surprise, given that SA’s prime interest rate has been rising since late 2021, remaining high until the first 25 basis point cut in September last year, with another reduction in November.

Another notable shift was the rise in digital payments, as cash withdrawals continued to decline.

“Consumers are turning to digital payment methods, in particular cellphone payments like instant money, for convenience. While these come with added fees, the introduction of Standard Bank PayShap has broadly aimed to reduce these costs, attracting more users to instant payment options,” says Mothilal.

Seasonal spending trends

In addition to these long-term patterns, these seasonal spending trends are worth noting:

• Fitness and self-care: Spending in this category peaks in December, likely driven by New Year’s resolutions and holiday-related self-care.
• Charity and donations: This tends to peak in April, possibly around Easter when charitable giving is encouraged.
• Clothing: Clothing spend also spikes in December, likely due to the festive season and holiday shopping.
• Education: Education-related expenses peak in January and February with back-to-school costs, but there is also a noticeable spike in July as students prepare for the second semester.
• Entertainment: Entertainment spending follows the festive season, with peaks in December and January.
• Holiday and travel: Interestingly, holiday and travel expenses do not show the same strong peak during the festive season. This is likely because travel is planned and paid for throughout the year, rather than being concentrated in the final quarter.

“This data shows that, despite tough economic conditions, South Africans remain resilient. At Standard Bank, we’re using all available resources to help clients manage their finances with money management tools and dedicated advisers for Private Banking clients,” says Mothilal.

To help consumers manage their finances — especially during Januworry — Standard Bank encourages customers to use the digital tools in its banking app. Tools such as Budget Manager help you set spending limits on what you spend on, while Money Movements helps you understand if you’re spending at partner stores that offer UCount rewards and discounts, helping you get more bang for your buck. The app also includes a Save & Invest feature to help you grow your wealth and reach your financial goals. 

This article was sponsored by Standard Bank.