FNB’s recent card data reveals that young South Africans born between 1997 and 2012 are growing more influential within the card payments’ customer base.
FNB Card’s latest data shows Gen Z customers make up a growing 6.5% of the total spend within the bank’s retail banking segment, with their spend value growing by 11% year on year (YoY), and their transaction volumes rising by 8%.
“This base represents young people at various stages in their lives. The oldest among them being in the growing stages of their working careers, potentially starting their families, and generally getting more disciplined about their financial commitments.
So, it’s no small feat that they represent a sizable portion of the spending power seen among our customer base, and these numbers clearly speak to their growing economic influence,” says FNB Credit Card Data Science Head Akshay Bhayroo.
Gen Z’s spend behaviour also provides further insights of interest. Gen Z’s top spending categories mirror those of millennials and the older retail base, with groceries, clothing, fuel, and fast food leading the way.
However, when compared to FNB’s overall retail customer basewho use either credit card or Fusion products for 43% of their spend needs, Gen Z’s spend using these products only accounts for 28%. “These product preferences are reflective of Gen Z’s ability to qualify for credit, which may sometimes limit their access to revolving facilities, combined with a level of financial caution,” opines Bhayroo.
The nicknames ‘Zoomers’, ‘iGeneration’, and ‘Digital Natives’ point to Gen Zs rapid usage of the internet and digital platforms. And, true to form, FNB also sees this group’s influence in driving the adoption of digital payments at the bank.
For example, 27% of Gen Zs spend is done online, compared to 22% of FNB’s overall base. At the same time, their online spend has grown by 20% YoY.
According to Bhayroo, this is nearly double the growth seen across FNB’s broader retail customer base, further underscoring Gen Z’s comfort with leading the adoption of digital platforms and e-commerce.
“We also see that their use of virtual cards has grown by 72% YoY, with 22% of their total spend also now taking place on virtual cards. This is well above the 16% average across all other customer age groups,” says Bhayroo, adding that this highlights that Gen Zs understand and have a strong preference for convenient, safe, tech-enabled payment methods.
The added value of FNB’s virtual cards is that they come with a dynamic card verification value (CVV) security code which changes frequently.
Customers can also temporarily block, cancel or replace their FNB or RMB virtual cards via their Banking Apps as soon as they suspect any kind of fraudulent activity.
“The rapid growth and adoption of our virtual card offering is encouraging and reassures us that we are on the right track as we continually work to make the lives of our customers easier while innovating to ensure that their transactional environment remains safe and secure.
Our focus is to provide a range of unique and innovative solutions that are centred around our customers’ needs and providing true value and help.” concludes Bhayroo.
Image (FNB Credit Card Data Science Head Akshay Bhayroo).
