New mobile security upgrade aligns with surge in digital wallet use, reports SpendTrend24

If you’ve downloaded the latest iOS upgrade, you’ll have noticed that you now have the option of switching on a new feature called Stolen Device Protection, which prevents passcode access to data such as passwords and stored credit cards when your device is in an unfamiliar location. For Android users, you can take steps to lock and wipe data from your device in the event of theft.

Rapid growth in digital adoption

The focus on mobile security is more relevant than ever. The annual SpendTrend24 report, produced in collaboration with Visa, reveals a significant increase in the adoption of digital wallets. In the next five years, according to a 2023 Visa study, digital wallet usage is projected to double, with transaction volume growing from 752 billion transactions in 2023 to 1.4 trillion in 2028.

Around the world, persistent high inflation has made consumers more cautious with their spending, driving them to choose their bank cards over cash to unlock the range of rewards and value that their credit cards offer. In addition to upfront discounts on flights, car hire and accommodation, Discovery Bank clients get Discovery Miles  back on groceries, personal care, fuel purchases and more, every time they swipe their Discovery Bank card to shop online or in-store.

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In 2023, the use of digital wallets as a share of total in-store purchases in South Africa increased by 9 percentage points. According to the 4Sight Digital Banking Behaviour Survey, more than 60% of South Africans prefer digital wallets because this technology eliminates the need for carrying a physical wallet, offers easy payment tracking, and provides convenience in shopping and making payments. Digital wallets remove the risk of physical theft or loss linked with carrying a physical wallet, because they safeguard your financial details behind layers of electronic authentication.

Shifting patterns in online vs in-store shopping

In South Africa, online grocery spend has increased by 10% compared with 2% for in-store purchases. The report also shows that South Africans’ spend growth in 2023 for online outpaces in-store by five times, surpassing other emerging market cities and keeping pace with developed ones. During Black Friday, the average value of online purchases made by Discovery Bank clients increased by 18% from 2022, while in-store purchase values decreased by 5%.

For online international payments South Africans are spending and shopping more from international platforms, while spend in-store at international destinations is growing at a slower pace. This can be attributed to emerging growth in streaming, gaming, and international e-commerce. There has been a rise in global online e-commerce platforms delivering to South Africa, with improved logistics and delivery times.

The comparison of the value of in-store versus online international spend per active card between 2022 and 2023 shows varied growth rates. For Discovery Bank clients in-store spend increased by 7% versus the rest of South Africa at 3%. Online spending saw an even greater disparity, with an 18% increase for Discovery Bank clients versus 10% for South Africans.

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Similarly, another data set for the same period highlights different growth rates: Discovery Bank client’s in-store transactions per active card grew by 3%, while the rest of South Africa saw a 1% increase. For online transactions, Discovery Bank clients showed 12% growth, significantly higher than the 5% increase for the rest of the country.

“South Africa stands out as a leader in the global shift towards digital wallets, online purchases, and contactless payments,” says Lineshree Moodley, Visa Country Manager. “The report offers valuable insights to support institutions expertly address diverse consumer needs and enhance their customer experiences. support institutions expertly address diverse consumer needs and enhance their customer experiences.”