FNB has seen a big upsurge in customer spending on home delivery, video and music streaming apps in the time since South Africa’s COVID-19 lockdown first started.
The increase has led to a boom in the usage of platforms like Mr D Food, Netflix, Showmax, iTunes, and Spotify, the bank said.
FNB Card CEO Chris Labuschagne said that individual customers were not necessarily spending more on any of the categories, but that more users across its base were buying the services.
“There is clearly a significant shift in consumers’ appetites and choices, based on where people choose to spend their money,” Labuschagne said.
“As part of our journey to support customers in their money management journey, our trusted platform capabilities are scaling quickly as we expect digital adoption to continue,” he added.
The bank told MyBroadband that its customers spent R841 million on video streaming subscriptions over the last year, a 78% increase over the R471 million spent in 2019.
The popularity of streaming platforms like Netflix, Showmax, and Amazon Prime increased significantly since the start of lockdown.
The average number of the bank’s customers who paid for subscriptions on each of these services increased as follows:
- Netflix – 64% increase
- Showmax – 78% increase
- Amazon Prime – 50% increase
Spend on music streaming services surged 44% over the last year, climbing from R635 million in 2019 to R915 million in 2020.
iTunes, Spotify, and YouTube Music were the major benefactors of this increase.
iTunes saw a modest 18% growth per month on average, while Spotify spend increased by 83%.
YouTube Music was the biggest winner with a massive 188% jump. The increase was attributed to customers being migrated from the Google Play Music service.
In terms of home delivery, FNB data showed that the Uber app was still the most used delivery app.
However, Mr D Food recorded the biggest increase in usage – with 140% higher spending on the service.
The number of FNB customers using Mr D Food had also grown 98% between March 2020 and March 2021.
Interestingly, there was no major change in the average amount that each customer spent on take-out food before versus after the start of lockdown.
Overall, home delivery totals decreased from R18.6 billion to R13.8 billion, which FNB contributed to the closure of restaurants.
Labuschagne said one of the most popular payments methods for subscriptions and online purchases was the bank’s Virtual Card.
Launched in January 2021, it allows customers on the FNB and RMB Private Bank apps to create a virtual card with a changing CVV number, limiting the chances of fraud.
However, it does not impact the renewal authentication for annual or monthly subscription.
Labuschagne said more than 200,000 Virtual Card had been activated since its launch, with total spend values approaching R200 million.