Home Credit Card Bank card debt drops beneath $20 billion

Bank card debt drops beneath $20 billion

by BankNews

New RBA figures out as we speak present Australians have slashed the nationwide bank card invoice to $19.71 billion in October – the primary time debt accruing curiosity has dropped beneath $20 billion in nearly 16 years.

Prior to now yr, Australians have wiped $7.80 billion in debt and brought the scissors to nearly a million bank card accounts.

Nonetheless, the speed at which Australians are paying off debt and shutting playing cards has slowed in October. Additionally, individuals gave their bank cards extra of a exercise in October, spending $473.8 million extra month-on-month, in authentic phrases.

Bank card statistics: month-to-month and year-on-year modifications

October Month-to-month change Yr-on-year change
(Sept vs Oct 2020) (Oct 2019 vs Oct 2020)
Variety of bank card accounts






Complete balances accruing curiosity

-$362.5 million

-$7.80 billion

$19.71 billion



Complete variety of transactions

6.7 million

-14.0 million

233.2 million



Complete worth of transactions

$473.8 million

-$3.24 billion

$20.34 billion



Supply: RBA, launched 7 December 2020, authentic information, excludes business playing cards.

RateCity.com.au analysis director, Sally Tindall, stated it was nice to see the entire debt accruing curiosity drop beneath $20 billion. 

“It’s taken us 16 years to get right here, and let’s hope we will maintain the debt accruing curiosity beneath $20 billion on the opposite aspect of Christmas,” she stated.

“Whereas Australians are nonetheless chipping away at their excellent bank card debt, the speed at which we’re knocking it off has slowed.

“Subsequent month the variety of transactions is prone to spike on account of pre-Christmas gross sales, comparable to Click on Frenzy and Black Friday. 

“The true take a look at shall be whether or not the debt accruing curiosity spikes too or whether or not Australians have learnt their lesson in regards to the perils of racking up excessive curiosity bank card debt.

“In case you’ve given your bank card a exercise within the lead as much as Christmas, attempt to work out a plan to pay your debt off earlier than your curiosity free days expire.

“The very last thing you need is to begin 2021 with a mountain of debt at charges as excessive as 24.99 per cent,” she stated.

Ideas for utilizing your bank card this Christmas 

  • Set a funds: Make an inventory and don’t overspend.
  • Take away the temptation: Put your credit score into the freezer when you’ve reached your funds restrict.
  • Make a plan to pay it again: Earlier than you spend, be sure to have the funds for to pay it again in January, so that you’re not lumped with curiosity costs.

Bank card statistics: change since COVID

March October Change since COVID
Variety of bank card accounts




Lowest since Nov 2007


Balances accruing curiosity

$26.98 billion

$19.71 billion

-$7.27 billion

Lowest since Oct 2004


Supply: RBA, launched 7 December 2020, authentic information, excludes business playing cards.

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