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ATM withdrawals in S Africa ho-hum before the holidays

November 14, 2013

Spark Cash Index statistics for October indicate that consumers have been holding off spending before the holiday buying season. The SCI, which measures the average cash withdrawal value at more than 2,200 Spark ATMs across South Africa, showed only a slight increase in ATM withdrawal levels for the month.

The SCI showed a month-on-month increase of .03 percent in average cash withdrawal figures for October to R468.20 ($45.48). Marc Sternberg, managing director of Spark ATM Systems, said the slight national increase reflected a mixed bag of withdrawal activity and tight spending in certain sectors.

Ronel Oberholzer, principal economist at IHS Global Insights, said she expects an uptick in average withdrawals to pick up in anticipation of the holidays.

"October is historically an 'in-between' month, falling in the middle of third quarter holidays and the end of year holidays, making it prone to reflect lower cash withdrawal values," she said. "The global economy is looking up, interests rates are still low, higher wages are being paid, lower petrol prices are expected and summer is almost upon us, so people will be more prone to spending." 

Sternberg said the most recent BankservAfrica Disposable Salary Index found that people in formal employment have more cash in their pockets and disposable salaries have increased nominally through the year.

"Quarterly employment data also reveals an increase in formal employment, so the build-up to the festive season, and an incoming stream of tourists, should start to positively affect the SCI data," he said.

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