Johannesburg –
Big four bank FNB says it expects consumers to spend 25 percent more on their credit
cards this year than the usual average monthly spend.
In a statement
issued on Monday, the bank says there is a consistent trend for consumers to
spend far more over the festive month than usual.
According to FNB Credit Card, credit card customers
spent a total of R6.7 billion over the December period last year, a 22 percent
increase when compared to the rest of the year. The largest increases in spend were on
entertainment followed by luxury goods and then home spending.
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“We looked
at our entire database, and took into account the average spend from January to
November last year, and the relative increase seen in December 2015, to give an
indication of how much more customers may expect to spend over this festive
season,” says Chris Labuschagne, CEO of FNB Credit Card.
The latest statistics
from the National Credit Regulator – for the June quarter – indicates that
there are 24.08 million credit-active consumers, of which 9.67 million
have impaired credit records.
In total, consumers owed R1.66 trillion at the end of
June, with R12 billion owing on credit cards.
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FNB Credit Card
data shows that, on average, customers who usually spend R6 650 on their
card during the year increased their spend by R1 460 in December 2015 to an
average of R8 100 per customer.
Entertainment
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The biggest jump,
of 52 percent, is seen in the entertainment category, which went from an
average of R447 million, up by R234 million, to a total of R681 million spent
in December. Entertainment includes restaurants, liquor stores, tickets for
theatre and events, as well as sport.
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Another large
increase is seen in luxury goods. Consumers spend 51 percent more than usual at
toy, clothing, electronic and jewellery stores during December compared to the
rest of the year. Average spend in this category increases from R241 million to
R365 million, during this time.
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Interestingly,
home spend—which is spend at furniture, hardware and garden
stores—increased by 44 percent in December when compared to the rest of the
year, from an average of R281.2 million to R404 million, as consumers take time
out to make home improvements.
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“Our customers
spent on average R350 per month on items for their homes during the year and
this went up to R485 in December 2015,” says Labuschagne.
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beauty sees an increase of 42 percent, from R158.9 million to R225.7 million,
and grocery bills go up from an average of R919 million to R1.2 billion, an
increase of 40 percent.
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Although South
Africans are not travelling to work every day, there is still a 12 percent
increase in petrol for the period as families travel to holiday destinations.
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The only
category that sees a significant decrease is spend on airline tickets, which
dives by 25 percent—R292 million spent monthly during the year versus R220
million in December—as most South Africans are already at their holiday
destinations.
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BUSINESS REPORT