Automated teller machine (ATM) withdrawal activity did not bounce back as expected last month following the sharp drop in January‚ indicating that consumers are still under financial pressure‚ independent ATM deployer Spark ATM systems said on Monday (11/03/2013).
Its latest cash index‚ which measures the average value of cash withdrawals across more than 2‚000 ATMs throughout SA‚ recorded a marginal month-on-month increase of 0.7% in average cash withdrawal figures for last month to R443.56 following a 9.2% month-on-month drop in average cash withdrawal figures in January.
"While it is encouraging to note a positive increase following the drastic drop in January‚ we were hoping for a bigger bounce back‚ especially if we assume that the economy is in the first stage of an up-cycle‚” Spark ATM Systems sales director Russel Berman said.
Spark obtains the value of the index by dividing cash dispensed for a particular month by the number of cash withdrawals at the 2‚000 ATMs during that month in urban and rural areas across all nine provinces. The data has not been adjusted for seasonality or for the effects of inflation.
Berman said a notable month-on-month increase should be expected for March ahead of the Easter holiday season‚ when many consumers spend more on entertainment and travel during the school holiday break.
The cash index recorded 7.7% year-on-year growth in February. IHS global insights principal economist Ronel Oberholzer said this was not necessarily a sign that consumers were in a better financial position this year.
"The February SCI (Spark Cash Index) indicates that it is ‘back to work’ for South African consumers who are cutting back on unnecessary costs such as entertainment and travelling after the festive season splurge‚ which is evident from the month-on-month declines in ATM withdrawal activity recorded at leisure (1.30%) and petrol (0.62%) sites‚” Oberholzer said.
Berman said that higher average cash withdrawal values and month-on-month growth recorded at wholesale and retail sites revealed that consumers were stocking up on supplies again following the January slump and were taking advantage of post-festive season sales.
"Given that many people receive their annual increases at the end of the financial year in February‚ paired with the Easter weekend falling a bit earlier this year‚ we can anticipate positive growth in the March 2013 statistics‚” Berman said. - BDlive
