Despite a weakening of economic activity in South Africa for the second consecutive month, residents of the country continued to actively use digital payment methods in June.
Stability of Digital Transactions
PayInc reported that 186.8 million electronic transactions were processed in June, which is 11.6% more compared to the same period last year. This indicates that households continue to spend money, but they are becoming more cautious due to rising fuel prices, increasing interest rates, and global uncertainty affecting public confidence.
Economic Index and Forecasts
PayInc's economic index, which tracks the real value of electronic operations alongside demand for cash in the wholesale sector, decreased by 0.9% in June after a previous reduction of 2.0% in May. This figure reached its lowest level since November 2025. Nevertheless, the index remained 2.5% higher than the previous year. Independent economist Elisa Kruger noted that the first half of 2026 showed a strong first quarter, followed by a noticeable slowdown in economic activity in the second quarter.
Slowing Growth Rate
The latest data confirms that the South African economy lost momentum in the second quarter. Economists warn that growth this year is likely to remain moderate, around 1.2%, as ongoing global uncertainty and consumer pressure negatively affect activity. Kruger stated that although the conclusion of a framework agreement on peace between the United States and Iran in June helped reduce some global tensions, uncertainty continues to affect business and consumer confidence.
According to Kruger, many people are being cautious, postponing decisions on investments and spending, which is reflected in the weaker economic activity recorded in the second quarter. Although oil prices are falling to about $72 per barrel, daily overpayments at gas stations for gasoline and diesel have dropped to less than 1 rand per liter. Meanwhile, households and businesses continue to feel pressure from high fuel prices and increased interest rates.
Kruger added that any decrease in fuel prices in early August may be limited unless the rand strengthens further or oil prices fall more significantly during the month. These factors, combined with reduced confidence, could put pressure on economic activity in the coming months.
Mixed Picture of Indicators
Other key indicators presented a mixed picture. The S&P Global South Africa Business Managers Index rose to 50.5 in June, signaling modest expansion, while Naamsa reported a 15.3% year-on-year increase in car sales. However, the Absa Business Managers Index fell to 47.3, indicating persistent weakness in domestic demand.
Kruger emphasized that the second quarter showed how quickly confidence can change in response to domestic and global events. She noted that while electronic payment activity remains resilient, the overall economic situation suggests that growth will remain subdued until inflationary pressures ease and confidence recovers significantly.
Continued Use of Digital Methods
PayInc specified that 186.8 million electronic transactions were processed in June, an 11.6% increase compared to last year, and the nominal value of electronic transactions increased from 1.369 trillion rand in May to 1.427 trillion rand. The volume of transactions for the first six months of 2026 grew by 11.2% compared to the same period last year, strengthening the trend towards electronic payments.
Shergean Naidu, Head of Stakeholder Engagement at PayInc, stated that the continuous growth in digital payments demonstrates that consumers and businesses are increasingly relying on electronic transactions for daily needs, even during periods of economic instability. Naidu also added that while traditional EFT payment flows continue to grow steadily, DebiCheck and PayShap are gaining momentum, reflecting the continuous evolution of the South African payment landscape.