South Africans swiped, tapped and transferred more money in May than any other month this year — a small but hopeful sign the economy may be stirring after months of stagnation.
But an economist warned it’s too early to call a shift in trend.
New data from BankservAfrica shows a modest rebound in electronic transactions, as its Economic Transactions Index (BETI) climbed to 138.3 in May from 136.2 in April.
This marks its first significant movement after eight months.
The BETI reflects the real value of all electronic transactions processed through BankservAfrica, the continent’s largest automated payments clearing house.
“While encouraging, it is too early to call an imminent change in trend as the economic environment has not changed materially in May and notable risks remain,” independent economist Elize Kruger said.
“Furthermore, a part of May’s improvement stems from wiping out the weakness evident in the index in April.”
In April, global markets were shaken by the US’s announcement of harsh import tariffs, triggering fears of a trade war. Uncertainty led to widespread downgrades of both international and domestic growth forecasts.
“Still, compared to a year earlier, the BETI is 1.4% higher and the uptick remains encouraging as all of its components increased in value terms during May,” Kruger said.
According to BankservAfrica, the recovery in May was broad-based.
The report showed that the most notable performances were the heavy weighted EFT credits, Real Time Clearing and PayShap transactions.
All payment streams rose in volume and value terms, with the number of transactions clearing through BankservAfrica reaching a record high of 176.3-million, up from 167.9-million in April. The standardised nominal value of transactions rose to R1.351-trillion, while the average transaction value increased to R7,618 from R7,485.
The BETI uptick coincided with other mildly positive signals. The S&P Global SA PMI climbed to 50.8 in May — its highest level in over a year — while local vehicle sales surged.
Naamsa reported a 22% year-on-year rise in total vehicle sales with new car sales up 30%.
However, structural weaknesses persist. The Absa manufacturing PMI remained deep in contractionary territory for the seventh straight month at 43.1.
Real GDP growth in the first quarter of 2025 was just 0.1%, with key sectors such as mining and construction now in technical recession. Consensus forecasts for 2025 GDP have been revised down to 1.2%, with Kruger projecting just 1.0%.
On the positive side, headline inflation remains contained at 2.8% — below the Reserve Bank’s 3%–6% target band — giving scope for monetary easing.
“Even after a 25bps cut in May, the repo rate at 7.25% remains quite high, as real interest rates are still considered punitive for an economy muddling along, unable to gain meaningful momentum,” said Kruger.
She added: “The low inflation rate will play a key role in supporting the recovery of salary earners’ purchasing power. With average salary increases expected to be between 5% and 6%, 2025 will be the second consecutive year of real increases in salaries, which should support consumer spending”.
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