Eating out and take-out spending increased significantly as people return to restaurants and this had increased 60% more at load shedding levels 5 and 6. Photographer: Dean Hutton/Bloomberg
As load shedding reaches higher levels every week, South Africans are being forced to fork out more cash during the ever-worsening cost of living crisis.
With boredom at its peak during load shedding, data has revealed that South Africans are spending more of their income on groceries and entertainment, which includes out-of-home experiences such as eating out.
One of the country’s biggest banks, FNB, says that this is according to their card data.
“Currently, groceries account for 28% of customer spend, compared to 27% last year, and entertainment is at 12%, compared to 11.5% last year. The current top 3 spend categories are groceries, transportation, and entertainment, respectively,” FNB said on Tuesday.
Another report of a combined analysis by Visa and Vitality Bank has revealed that people lean towards spending more on eating out during load shedding.
The report revealed that eating out and take-out spending increased significantly as people returned to restaurants, and this had increased 60% more at load shedding levels 5 and 6.
“We witnessed a larger volume of clients transacting on take-out meals and at restaurants as the stages of load shedding increased. We also see peak volumes during stage 5 and stage 6 of load shedding, as more people are compelled to order in, or collect, their food,“ the Visa and Discovery report said.
Additionally, many fed-up citizens also spend money on alternative energy solutions to meet their needs, such as installing inverters or solar panels in their homes, purchasing rechargeable lights and candles, as well as adjusting their shopping trends to cater to the rolling power cuts.
Lytania Johnson, CEO of FNB Personal Segment, which consists of entry-level to middle-income customers, says, ‘’Food and transport generally make up a significant portion of spend among many consumers, especially those in these income segments. Therefore, any increase in costs in these categories will always require households to review their monthly budgets. Unfortunately, food costs have largely been influenced by local and global economic factors that consumers cannot control. As a business that is focused on helping customers better manage their financial and lifestyle needs, we continue to support our customers with our advice-driven money management tools and rewards that help their money go further.’’
Senzo Nsibande, the FNB Card CEO, said, ‘’It is not surprising to see groceries and transport at the top of the list, as both food and fuel have been among the largest contributors to high inflation. Interestingly, in the entertainment category, we see largely middle and affluent-income consumers spending more on out-of-home experiences such as eating out, going to movie theatres and bookstores, among others. This may be due to a combination of factors, such as people finding ways to mitigate the impact of load shedding on domestic activities and an increasing desire to spend time outdoors.’’
As the country continues to battle the effects of load shedding, that is just on one front, there are other mounting pressures consumers face, such as rising petrol costs, interest rates being hiked by the South African Reserve Bank, food inflation while the country has fallen into a greylisting status.
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