South African consumers are adjusting their financial behaviour in response to ongoing cost pressures, with TransUnion's Q1 2026 Consumer Pulse Study[1]  revealing meaningful shifts in how households spend, save and manage credit. While many households remain under financial strain, the findings point to a shift toward more deliberate and considered financial decision-making.

The study found that inflation for everyday goods remains the leading financial concern, cited by 41% of respondents as their top financial worry. 35% of consumers indicated that they expect to be unable to pay at least one of their current bills or loans in full.

Against this backdrop, consumer sentiment remains measured. More than two-thirds (69%) of respondents said they are optimistic about their household finances over the next 12 months, down from 72% in Q4 2025, while 14% expressed pessimism and 17% indicated they are neither optimistic nor pessimistic.

“Consumers are not necessarily experiencing financial ease, but they are responding in practical ways to manage pressure,” said Ayesha Hatea, director of research and consulting at TransUnion South Africa. “What we are seeing is a shift toward more deliberate financial behaviour, where households are actively adjusting spending, prioritising obligations and, where they can, building financial buffers.”

Spending Pullbacks and Savings Adjustments Take Hold

In response to continued financial pressure, many South Africans have adjusted their financial behaviour over the past three months. More than half of the respondents (51%) reported cutting back on discretionary spending such as dining out, travel and entertainment, while 31% said they cancelled subscriptions or memberships.

At the same time, some households report taking steps to strengthen their financial position in the past three months. The study found that 35% of respondents said they paid down debt faster, while 29% reported increasing contributions to emergency savings or stokvels. A further 23% said they increased their retirement savings.

“These behaviours reflect a more cautious and intentional approach to money management. Consumers are looking for ways to maintain stability, whether by reducing non-essential expenses, managing debt more actively or setting aside funds for future needs,” said Hatea.

Financial Outlook Reflects Cautious Confidence

Despite ongoing affordability challenges, the study points to cautious consumer expectations at the time it was conducted. The research was carried out in late February, prior to recent geopolitical developments and ahead of the most recent South African Monetary Policy Committee (MPC) announcement, which left the prime lending rate unchanged. Emerging global market volatility may further shape consumer sentiment and financial behaviour going forward.

More than one in three consumers (35%) expect their spending on bills and loans such as housing, utilities, insurance and credit cards to increase over the next three months. The same percentage (35%) anticipate higher spending on medical care and services during that timeframe.

Additionally, 38% expect to increase contributions toward retirement funds and investments. Conversely, a smaller percentage said they’d increase their spending on in-store or online retail shopping such as clothing, electronics and durable goods (29%), large purchases like appliances and cars (26%), digital services (25%) and discretionary spending (21%).

“This pattern suggests that consumers are prioritising essential and future-oriented expenses, while remaining more selective in discretionary areas. It reflects a mindset where financial decisions are being made with greater scrutiny,” said Hatea.

Credit Remains Important, but Caution is Evident

Access to credit continues to play an important role in how consumers manage their finances. However, when it comes to new credit products, TransUnion’s survey indicates that households are approaching borrowing more carefully in the current environment.

Among respondents, 41% indicated that they have used Buy Now, Pay Later (BNPL) services in the past year. For those who have used BNPL, avoiding credit card interest was a key motivation, while non-users most frequently cited avoiding additional debt as the top reason for never using BNPL.

“The role of credit is evolving,” Hatea said. “Consumers still rely on it to manage cash flow and navigate short-term pressures, but there is also a clear awareness of the need to avoid overextension. That balance between access and caution is becoming more important.”

Adapting to a More Demanding Financial Environment

The quarterly findings point to a consumer environment defined less by financial comfort and more by ongoing adjustment. While sentiment has softened slightly from the previous quarter, many South Africans are actively managing their finances amid ongoing cost pressures.

“Rather than a broad sense of financial confidence, we are seeing a more grounded and pragmatic approach,” said Hatea. “Consumers are making deliberate trade-offs to stay on top of their obligations and build resilience where possible. As economic uncertainty persists, the ability to adapt spending, savings and credit behaviour is likely to remain a defining feature of the South African consumer landscape.”