The total household credit card debt attracting interest charges has risen for the fourth month in a row, as the country finds itself on a debt treadmill.

The latest RBA credit card statistics, released today for the month of March, shows the total credit card bill attracting interest on personal credit cards is now $17.66 billion, a rise of almost $49 million from the previous month, and an increase of almost $375 million since November 2023.

While post-Christmas credit card debt is common, it usually starts dropping from the month of March. This time around Australia’s credit card debt problem has instead worsened.

RateCity.com.au analysis of RBA data shows this is the first time debt has risen in the month of March since 2015.

RBA: Credit card debt attracting interest charges (excludes commercial cards)

Amount owing – March 2024	Monthly change	Year-on-year change
$17.66 billion	+$48.62 million +0.30%	-$74.33 million -0.4%

Source: RBA, released 7 May 2024, original data, excludes commercial cards.

Change in debt accruing interest each March 2015-2024 (%)

Source: RBA, released 7 May 2024, original data, excludes commercial cards.

Credit card spending ticks up in March

Spending on credit cards rose in March in seasonally adjusted terms, however, overall spending was down, month-on-month across both credit and debit cards.

Total value of transactions: personal credit and debit cards

	Amount – March 2024	Monthly change	Year-on-year change
Credit (personal cards only)	$27.32 billion	+$245.9 million +0.9%	+$1.74 billion +7%
Debit	$49.57 billion	-$370.8 million -0.7%	+$2.65 billion +6%
Total	$76.88 billion	-$125.0 million -0.2%	+$4.39 billion +6%

Source: RBA, released 7 May 2024, seasonally adjusted data, excludes commercial cards.

The number of credit card accounts continues to rise

The number of credit card accounts rose for the 18th consecutive month.

As of the end of March, there were 12.68 million personal credit card accounts. This is almost 300,000 more than the recent trough in May 2022, but down considerably from the peak of credit card accounts in June 2017 when there were 15.45 million active credit card accounts.

RBA credit card statistics: March 2024 (Note: commercial cards are excluded)

	Amount	Monthly change	Year-on-year change
Number of accounts	12.68 million	+6,548 +0.05%	+135,460 +1.1%

Source: RBA, released 7 May 2024, original data, excludes commercial cards.

RateCity.com.au research director, Sally Tindall, said: “For eight years we’ve seen credit card debt decline in the month of March, but not this time around.”

“We’re very used to seeing households pile up the debt over summer, but the fact that many are still struggling to reduce this debt in March is cause for alarm,” she said.

“A recent RateCity.com.au survey found almost one in seven credit card users were relying on their card to get them through to payday - a strategy that’s destined to fail, and quickly.

“Plugging a budget black hole with the plastic can put you on a debt treadmill that’s difficult to get off.

“If you are struggling with credit card debt, don’t put your head in the sand. Take the time to come up with an action plan that sees you clear the slate clean entirely,” she said.

Solutions for managing credit card debt

1. Call your bank and ask for help. The bank will work with you to find a solution, whether it’s changing your interest rate or putting you in financial hardship.
2. Tell your other providers you are in financial hardship. Many providers will see if you can switch to a cheaper plan or put you on a payment plan. 
3. Consider a circuit breaker. Renting out a spare room, moving somewhere cheaper and leasing out your home or selling up are options you may decide to consider. 
4. Get independent financial advice. Call the national debt helpline on 1800 007 007.

With the Reserve Bank of Australia (RBA) keeping the cash rate on hold in May 2024, and economists from some big banks pushing back their rate cut forecasts, Australians wanting cost of living relief may need to give themselves a rate cut. Comparing home loans options before your switch can give you a better idea of which options may be best for your financial situations and personal goals. 

Given ‘sticky’ inflation figures and other economic factors, economists from major Australian banks have revised their cash rate forecasts, pushing back the date of possible rate cuts until November 2024. However,some other commentators are predicting that the RBA’s next move could actually be to raise the cash rate to help counter inflation.

Australians looking for a new home loan, or to switch their current home loan, could benefit from RateCity’s Real Time Ratings™ when making their mortgage comparisons. These star ratings are regularly updated based on the cost and flexibility of each home loan deal to give you a better idea of its overall value at a glance. The top-rated home loans in different categories are collected on RateCity’s Home Loan Leaderboards, with some of the top-rated options becoming eligible for RateCity Gold Awards.

New data shows more Australians may be taking out personal loans, while others are struggling with the cost of living. But what effect could a personal loan have on managing household budgets?

The most recent Lending Indicators from the Australian Bureau of Statistics (ABS) shows that the value of new loan commitments for fixed term personal finance rose 3.9% in March 2024, reversing a fall of 0.5% in February 2024. This rise is partially attributed to a 4.3% increase in loans for road vehicles, which broadly aligns with recent car sales figures, which have broken records each month since 2024 began.

The ABS data also shows personal loans for household goods are on the rise as Australians try to manage cost of living pressures. Loans for household and personal goods rose by 1.2% in the month of March, taking it to the third highest amount on record. 

The ABS Household Spending Indicator shows that household spending in March 2024 was 2.1% higher than a year ago but has slowed since the beginning of the year. Non-discretionary spending rose 4.0%, driven by increased spending on transport services and food, while discretionary spending fell 0.1%. In other words, Australians appear to be spending less on luxuries but more on essentials.

In some cases, a personal loan could help you take control of your finances and relieve some of your financial stress. For example, a debt consolidation personal loan could help you better manage your debts by giving you just one repayment and interest rate to manage. However, lenders will want to know your loan’s purpose before they’ll approve a personal loan application. Your credit score could also affect the loan application’s chance of success. 

Another method to try and better manage your household budget is to invest in energy efficient home features and technologies, from solar panels to EV chargers, which could potentially greatly reduce your power and fuel bills. The upfront costs of going green could potentially be partially offset by state and federal government grants and incentives, as well as with the help of green personal loans, which are often limited to specific purposes but have lower interest rates than many other finance options.

You can quickly compare green personal loans and other options with the help of RateCity’s Real Time Ratings™, which combine the cost and flexibility of different personal loan products into a simple star rating, which is regularly updated for improved accuracy. Some of the top-rated options on the RateCity Personal Loan Leaderboards may also become eligible for a RateCity Gold Award.

How are you managing your savings? Whether you have a savings goal you’re actively working to achieve, or are simply regularly putting a little aside for a rainy day, you’ll want to be confident that you have a savings account that suits your needs. Comparing savings accounts could be an important first step on the road to financial security.

Data from the Australian Prudential Regulation Authority (APRA) indicates that Australians are currently sitting on a record $1.47 trillion in deposits across savings accounts, term deposits, mortgage offset accounts and transaction accounts. This is almost $200 billion more than before the start of the cash rate hikes two years ago. In March 2024 alone, more than $8.2 billion was deposited in banks and other Authorised Deposit-taking Institutions (ADIs).

It's not too surprising that many Australians are prioritising saving where possible. It’s unclear when the Reserve Bank of Australia (RBA) may cut interest rates, which could offer some cost-of-living relief to mortgage holders. It’s also possible that the central bank could end up raising rates again in response to sticky inflation, so a savings buffer could be helpful for limiting potential future financial stress.

However much money you have saved, it’s worth comparing savings account options to help ensure that your account will suit your needs. RateCity’s Real Time Ratings™ could help you here, as they are based on the cost and flexibility of different savings accounts and updated regularly for accuracy. The top-rated savings accounts on RateCity’s Savings Account Leaderboards may also be eligible for a RateCity Gold Award.

Australians are reportedly saving record amounts of money, according to recently released statistics. If you want to put part of your savings into a term deposit, it’s worth comparing your options to help ensure you’re selecting an option that will suit your needs.

According to the data from the Australian Prudential Regulation Authority (APRA), Australians deposited more than $8.2 million into term deposits, transaction accounts, mortgage offset accounts and savings accounts in March 2024. This brings Australia’s total household deposits to $1.47 trillion; almost $200 billion more than before the start of the cash rate hikes two years ago.

Putting some of your available savings into a term deposit can be an option to help protect your wealth and earn interest income. Money in a term deposit is guaranteed by the Australian government up to $250,000 per person per Authorised Deposit-taking Institution (ADI) – in the unlikely scenario that your bank was to go out of business, you should be able to claim your money back. And because you agree to deposit this money for a pre-set term, and can’t withdraw it early without providing a month’s advance notice, it’s not as easy to succumb to the temptation to spend your cash on a whim.

Because term deposit interest rates are fixed in advance, it’s easy to calculate the interest returns you’ll receive on the money you deposit. These returns may be more reliable and consistent than those on some other investments. Of course, it’s important to note that many term deposits pay simple interest, rather than the compound interest more often used with savings accounts, so you may not be able to easily grow your wealth over time.

Before you invest part of your savings into a term deposit, it’s important to compare your options and make sure you’re making the best choice for your needs. RateCity’s Real Time Ratings™ can help you find the value of different term deposits at a glance, based on their interest and flexibility. The top-rated term deposits on the RateCity Term Deposit Leaderboards may also become eligible for a RateCity Gold Award.  

The total household credit card debt attracting interest charges has risen for the fourth month in a row, as the country finds itself on a debt treadmill.

The latest RBA credit card statistics, released today for the month of March, shows the total credit card bill attracting interest on personal credit cards is now $17.66 billion, a rise of almost $49 million from the previous month, and an increase of almost $375 million since November 2023.

While post-Christmas credit card debt is common, it usually starts dropping from the month of March. This time around Australia’s credit card debt problem has instead worsened.

RateCity.com.au analysis of RBA data shows this is the first time debt has risen in the month of March since 2015.

RBA: Credit card debt attracting interest charges (excludes commercial cards)

Amount owing – March 2024	Monthly change	Year-on-year change
$17.66 billion	+$48.62 million +0.30%	-$74.33 million -0.4%

Source: RBA, released 7 May 2024, original data, excludes commercial cards.

Change in debt accruing interest each March 2015-2024 (%)

Source: RBA, released 7 May 2024, original data, excludes commercial cards.

Credit card spending ticks up in March

Spending on credit cards rose in March in seasonally adjusted terms, however, overall spending was down, month-on-month across both credit and debit cards.

Total value of transactions: personal credit and debit cards

	Amount – March 2024	Monthly change	Year-on-year change
Credit (personal cards only)	$27.32 billion	+$245.9 million +0.9%	+$1.74 billion +7%
Debit	$49.57 billion	-$370.8 million -0.7%	+$2.65 billion +6%
Total	$76.88 billion	-$125.0 million -0.2%	+$4.39 billion +6%

Source: RBA, released 7 May 2024, seasonally adjusted data, excludes commercial cards.

The number of credit card accounts continues to rise

The number of credit card accounts rose for the 18th consecutive month.

As of the end of March, there were 12.68 million personal credit card accounts. This is almost 300,000 more than the recent trough in May 2022, but down considerably from the peak of credit card accounts in June 2017 when there were 15.45 million active credit card accounts.

RBA credit card statistics: March 2024 (Note: commercial cards are excluded)

	Amount	Monthly change	Year-on-year change
Number of accounts	12.68 million	+6,548 +0.05%	+135,460 +1.1%

Source: RBA, released 7 May 2024, original data, excludes commercial cards.

RateCity.com.au research director, Sally Tindall, said: “For eight years we’ve seen credit card debt decline in the month of March, but not this time around.”

“We’re very used to seeing households pile up the debt over summer, but the fact that many are still struggling to reduce this debt in March is cause for alarm,” she said.

“A recent RateCity.com.au survey found almost one in seven credit card users were relying on their card to get them through to payday - a strategy that’s destined to fail, and quickly.

“Plugging a budget black hole with the plastic can put you on a debt treadmill that’s difficult to get off.

“If you are struggling with credit card debt, don’t put your head in the sand. Take the time to come up with an action plan that sees you clear the slate clean entirely,” she said.

Solutions for managing credit card debt

1. Call your bank and ask for help. The bank will work with you to find a solution, whether it’s changing your interest rate or putting you in financial hardship.
2. Tell your other providers you are in financial hardship. Many providers will see if you can switch to a cheaper plan or put you on a payment plan. 
3. Consider a circuit breaker. Renting out a spare room, moving somewhere cheaper and leasing out your home or selling up are options you may decide to consider. 
4. Get independent financial advice. Call the national debt helpline on 1800 007 007.