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Credit card exodus continues, as those left standing get smarter with debts
New data from the RBA today shows Australians are continuing to shy away from credit cards. But those that are still using plastic are getting smarter about how they use their cards.
The RBA credit card statistics for July show the number of active personal credit card accounts fell by 66,836 accounts between June and July and 336,006 accounts year-on-year, to the lowest level since November 2014.
Australia’s debt levels are shrinking too – with balances accruing interest dropping 6.6 per cent in July, year-on-year.
However, the number of purchases on personal credit cards rose 7.9 per cent in that year, notably jumping 16.93 per cent from June to July 2019.
RBA personal credit card statistics – July 2019
July 2019 | Change from previous month | Change from July 2018 % | Comments | |
Total balances accruing interest | $28.75 B | -1.80% | -6.60% | Lowest since July 2007 |
Balance accruing interest per account | $1,981 | -1.3% | -4.4% | Lowest since December 2017 |
No. of personal credit card accounts | 14,511,903 | -66,836 | -336,006 | Lowest since November 2012 |
Total credit card limits | $135.36 B | -0.48% | -3.21% | Lowest since September 2015 |
No. of credit card purchases per month | 247,552,161 | 16.93% | 7.90% | Highest on record since 2002 |
Notes: Excludes commercial cards, using original data from the RBA. Data released 12 September 2019. Some people have more than one card.
Sally Tindall, research director at RateCity.com.au, said, “It’s good to see Australians are chipping away at their credit card balances.”
“While there has been an exodus away from credit cards, a lot of people who have opted to keep them in their wallets are being smarter about how they use them.
“Many Australians are starting to realise the only way to sensibly use a credit card is to pay off the debt in full. With interest rates as high as 24.99 per cent, credit card debt can be crippling.
“That said, with $28.75 billion dollars in credit card debt still accruing interest, there is still a long way to go,” she said.
Disclaimer
This article is over two years old, last updated on September 12, 2019. While RateCity makes best efforts to update every important article regularly, the information in this piece may not be as relevant as it once was. Alternatively, please consider checking recent credit cards articles.
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