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More money being circulated strongly suggests that the health of the South African economy is strengthening, according to Chris Hamilton, CEO of automated payments clearing house BankservAfrica.
BankservAfrica experienced robust growth in the value and volume for real-time clearing (RTC) payments in April 2018 on a year-on-year (y/y) basis.
RTCs allow customers to move single credit payments in real time to inter-banked beneficiaries 24 hours a day, seven days a week and 365 days a year.
In April 2018 the value of RTCs reached R30bn, growth of 75% from a total of R22bn in April 2017.
Growth was also recorded in the volume of RTCs, which was 2.1 million in April 2018 and represented a 62% jump from the 1.3 million in the same period in the previous year.
“These figures present a picture of the substantial value and size of instant electronic payments that are taking place in South Africa,” says Hamilton.
Earlier this week the BankservAfrica Economic Transaction Index (BETI) also indicated that the local economy continued to grow, despite the various tax increases that came into effect at the beginning of April.
The latest BETI reflects growth across all measurement periods in April. Consumer confidence was at its strongest in the first quarter of 2018, reflecting the economy’s growth despite the changes in value-added tax, according to the BETI report.
“With the VAT increase, new sugar tax, higher excise tax as well as higher fuel tax, one expected a slower month in April. But the fact is that there was month-on-month growth, albeit at a slower rate. This indicates there is some underlying momentum in the economy,” says Mike Schüssler, chief economist at Economists dotcoza.
That the BETI is showing its sixth month without any decline bodes well for SA's growth prospects this year, according to the report. The last period SA saw the BETI with six consecutive months without declines ended in August 2013.
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