Kenyans begin to spend as economy opens up

 

Consumer spending is slowly picking up as business outlets enjoy longer working hours, a survey by Standard Chartered bank shows.

49 per cent of those surveyed, in the study that involved 12,000 adults across 12 markets, reported increased spending in July.

About 93 per cent of Kenyans said the pandemic has made them more careful with their expenditure (75 per cent globally), the highest proportion of any country surveyed.

Reflecting this increased caution, 91 per cent of Kenyan respondents said that the economic impact of Covid-19 has made them more likely to track their spending.

Over 80 per cent of Kenyans are either using or interested in using budgeting tools or tools that block card-spend over specified limits.

Globally, including Kenya, consumers are reported to be spending more on basics - such as groceries and healthcare - and digital devices than they did prior to the pandemic, and they expect the trend to continue.

This trend is reflected in Kenya, with consumers seeing a 58 per cent increase in their expenditure on groceries, a 59 per cent increase in spend on digital devices, and a 39 per cent increase in healthcare expenditure.

Meanwhile in Kenya, 80 per cent of people say they have spent less on travel/holidays than they did before the pandemic, while 49 per cent have spent less on experiences, and 83 per cent have spent less on clothes.

“As well as increased caution when it comes to spending, consumers are increasingly conscientious. This is good news for small businesses and those producing locally made goods, particularly those making and selling sustainably sourced products,” the survey released yesterday notes in part.

Kenya leads the way globally in increasingly conscientious consumption habits; 81 per cent of Kenyans say they are now more likely to shop locally (57 per cent globally), 75 per cent are more likely to shop sustainably (52 per cent globally), and 70 per cent are more likely to support smaller businesses (50 per cent globally).

Meanwhile, Covid-19 has seen consumers across the world ditch cash and in-person shopping in favour of online spending, according to the Standard Chartered’s latest global survey.

Almost three-quarters of survey respondents in Kenya (64 per cent globally) agree that Covid-19 has made them more positive about online shopping, but they are also more careful with their spending and want new ways to track their money digitally.

The study featured respondents from Hong Kong, India, Indonesia, Kenya, Mainland China, Malaysia, Pakistan, Singapore, Taiwan, UAE, the UK and the US–the second in a three-part series, looking at how Covid has transformed ways of life.

In Kenya, 79 per cent preferred to shop in-person prior to the pandemic compared to 21 per cent online.

But this has shifted significantly, with more than half (51%) now preferring online payments to in-person, card or cash payments for future purchases.

The survey was supported by Standard Chartered’s ATM withdrawals data which shows that a cross the ten surveyed markets, where Standard Chartered offers consumer banking (all except the UK and US), Covid has dramatically accelerated the decline in ATM usage.

“Cash withdrawals from ATMs are now half what they were two years ago. Today, 89 per cent of transactions are being conducted digitally with a 62 per cent and 90 per cent penetration for our retail and corporate clients,” StanChart head of retail banking, Edith Chumba, said.