South African households are showing signs of meaningful financial adaptation amid ongoing cost pressures, according to TransUnion’s latest Q4 2025 Consumer Pulse Study.
While inflation and affordability challenges persist, consumers are becoming more intentional in their financial management, tightening budgets, prioritising savings, and building greater digital and financial awareness.
“Consumers are entering 2026 with a renewed sense of financial discipline,” says Ayesha Hatea, director of research and consulting at TransUnion South Africa. “We’re seeing households make more deliberate choices, reducing non-essential spending, paying down debt and preparing for the future. This speaks to a financial confidence grounded in awareness and adaptability.”
Financial adaptation in a high-cost environment
Nearly half (48%) of South Africans said their household finances were better than planned in Q4 2025, a sign of growing stability in an economy still defined by high living costs. Yet, 36% of consumers anticipate being unable to meet at least one bill or loan payment in full, revealing the continued strain on affordability.
In response, many households are taking deliberate steps to manage their finances. Half have reduced discretionary spending on non-essential activities such as dining out, entertainment, and travel, while more than a third (34%) have cancelled subscriptions or memberships.
At the same time, 38% of consumers plan to increase their contributions toward retirement savings or investments, 35% are accelerating debt repayments, and 27% are setting aside more in emergency funds or stokvels.
These actions suggest that South Africans are not merely reacting to economic pressure but are intentionally strengthening their financial resilience. “Consumers are demonstrating a more strategic approach to money management,” said Hatea. “They’re preserving stability today while laying the groundwork for tomorrow.”
Younger optimism meets experienced caution
Generational insights reveal that financial resilience takes on different forms across age groups. Younger consumers, particularly Gen Z (18-28 years) and Millennials (29-44 years), tend to be the most optimistic about their financial future and are also the most likely to apply for new credit within the next year, with 42% and 39% expressing this intent, respectively.
In contrast, Gen X (45-60 years) and Baby Boomers (61+) demonstrate a more cautious approach, with only 33% and 9% likely to seek new credit, instead prioritising debt reduction and savings.
Spending patterns further illustrate this divide: younger consumers plan to increase their spending on digital services such as internet and other discretionary activities like dining out or travel, while older generations indicate they will prioritise boosting retirement funds and strengthening emergency savings in the coming months.
Credit access and inclusion
Credit remains a vital tool for long-term financial mobility, with 91% of South Africans recognising its importance in achieving their financial goals. Yet, access to credit is uneven: only 42% feel they have adequate access, while 33% believe they do not.
Despite this strong demand, just 36% plan to apply for new credit or refinance existing debt over the next year, with credit cards (30%), personal loans (28%), and car loans (20%) among the most popular products.
However, 44% of those who considered applying ultimately decided against it, citing barriers such as high borrowing costs (33%), fear of rejection due to their credit history (26%), and concerns over income or employment (24%).
“These findings highlight a need for more inclusive and transparent lending models,” says Hatea. “Consumers believe that a broader use of alternative data, such as rental or buy-now-pay-later payment histories can help extend fair access to credit while supporting responsible borrowing.”
Digital fraud threats drive demand for simplified protection tools
Digital fraud continues to pose a significant threat to South Africans, with 59% targeted in Q4 and 12% falling victim. The most commonly reported schemes include money or gift card scams (32%), vishing (30%), phishing (29%), and smishing (27%).
Despite these threats, 46% of consumers successfully detected and avoided fraud, reflecting growing vigilance. Among those affected by data breaches, 42% changed their passwords, 35% checked accounts for unauthorised activity, 30% closed compromised accounts, and only 16% signed up for identity monitoring.
In the past two months, reacting to security concerns, 58% changed passwords, 23% enabled multi-factor authentication, and 37% checked their credit reports. Yet, many remain unsure how to respond: 53% of those who took no action cited uncertainty about the steps to take, while 22% felt overwhelmed by cybersecurity information.
Empowered and financially-aware consumers
Financial awareness among South Africans continues to rise, with 93% recognising the importance of credit monitoring. Engagement with credit reports is also increasing, with 31% checking monthly, 16% weekly, and 8% daily.
Nearly half of consumers believe their credit score would improve if alternative data, such as rental payments or buy-now-pay-later histories, were considered, particularly among younger generations.
“This growing awareness of credit health is encouraging,” says Hatea. “Consumers are becoming more proactive and engaged, and that creates a powerful opportunity for businesses and lenders to support them with relevant, transparent financial tools.”
Building financial confidence for the future
The Q4 findings paint a picture of a nation adapting with purpose, cautious but confident, pragmatic yet forward-looking. As South Africans continue to manage affordability pressures, the emphasis on long-term financial planning, inclusion, and protection is reshaping how consumers engage with the financial system.
“Resilience has become the defining characteristic of South African consumers,” says Hatea. “They’re not waiting for conditions to change, they’re taking control of their financial journeys, showing that confidence and caution can coexist.”