South African consumers are spending less but gambling more, says Absa report

The latest Absa Merchant Spend Analytics Report for the first half of 2025 released Monday indicates that South African consumers are curtailing their spending while increasingly engaging in gambling activities.

This reflects not only shifting financial priorities but also the rapid transformation within the gambling sector driven by technology..

Isana Cordier, managing executive for the consumer sector at Absa Corporate and Investment Banking, stated that the bank's internal data shows a 6% month-to-month decline in total card spending, coupled with an 8% fall in transaction volumes.

“This aligns with historical trends, as internal data suggests that June typically experiences negative growth,” Cordier said.

“Despite this decline, month-to-month, year-on-year performance showed a modest 2% increase, suggesting some resilience in consumer activity over the longer term. The average transaction value increased by 3%.”

The data is telling: In 2022, card spending in the gambling sector jumped by 32% even as overall transaction volumes decreased by 25%. The following year marked a dramatic reversal with a staggering 52% surge in spending and a 211% increase in transaction volume.

Fast forward to June 2025, and year-to-date card spending transactions in the gambling category have risen by 17%, albeit slower than the 24% growth recorded in the same period the previous year. Meanwhile, transaction volumes climbed by 16%, down from an explosive 52% growth in 2024.

The report underscores a clear trend identified in the shift of gambling formats: while in-store gambling has seen a slight 1% year-on-year decline, online gambling has surged by an astounding 66%.

Online gambling now commands a 61% share of transactions within the category as of June 2025, a significant increase from just 26% in 2022.

This burgeoning engagement with gambling can be partially attributed to the broader socio-economic challenges faced by many South Africans. As households navigate the strains of rising living costs, a trend emerges where consumers often gravitate towards lower-value purchases.

The report highlights an evolving mindset in consumer behaviour: between the first half of 2022 and the first half of 2025, average transaction values have hovered in negative territory for four consecutive periods, indicating a preference for smaller, frequent purchases.

For retailers, Cordier advocates for accommodating this shift, suggesting that success may lie in delivering value-driven, small-ticket items.

This sentiment was echoed during a recent panel discussion at the Absa Consumer Conference in Cape Town, where retailers noted an increase in smaller purchases among consumers.

The report said that credit card usage continues to outpace debit card usage – a trend that may be signalling that many consumers are looking to credit to manage rising living costs.

“While online spending remains strong, maintaining double-digit growth, in-store spending has slowed to just 1%. This decline is largely driven by the food category, which already has a high base of 48% year-to-date from 49% in June 2024 and saw minimal growth of 1% year-to-date from 3%,” it said.

“In contrast, online food-related purchases surged by 49% (YTD Jun’24: 28%), although the category’s market share slightly dropped to 17% (YTD Jun’24: 18%).”

BUSINESS REPORT