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Australia’s credit card debt rises for 4th month in a row

Australia’s credit card debt rises for 4th month in a row

07 Apr, 2022 - 3 min read

The national credit card debt has risen for the fourth month in a row to $17.44 billion, according to new data from the RBA today.

Debt accruing interest on personal credit cards in February increased by $50.8 million from the previous month, in original terms.

The number of accounts stayed relatively flat, rising by just 4,853 accounts, to a total of 12.4 million.

Note: credit card analysis is based on personal credit card data and excludes commercial cards.

Credit card statistics: personal credit cards in February 2022

	Amount	Monthly change	Year-on-year change
Number of accounts	12.4 million	4,853 0.04%	-287,855 -2.3%
Value of transactions	$21.58 billion	$515.7 million 2.4%	$1.86 billion 9.4%
Balances accruing interest	$17.44 billion	$50.8 million 0.3%	-$2.25 billion -11.4%

Source: RBA, released 7 April 2022, original data, excludes commercial cards. Monthly change is Jan 2022 to Feb 2022, year-on-year change is Feb 2021 to Feb 2022.

RateCity.com.au research director, Sally Tindall, said: “Credit card debt has ticked up for the fourth month in a row. While the rises have, so far, been relatively moderate, it’s a red flag some Australians are doing it tough.”

“Australians made huge headway into credit card debt over the last two years. It’s agonising to see some of that hard work come undone,” she said.

“You only have to go to the petrol station or the supermarket to know that inflation is on the rise and that’s putting pressure on some family budgets.

“Families who are struggling to make the monthly budget add up should search high and low for a more permanent solution instead of sticking any excess on the credit card.

“Credit debt accruing interest at a rate of 17 per cent – sometimes even more – is the last thing people need if they’re having trouble keeping on top of the bills.

“If you’re struggling to make ends meet, look for ongoing ways you can inject some relief. Switching utilities providers, cutting back on meals out and rotating your entertainment subscriptions might seem trivial, but they all add up,” she said.

Screen Shot 2022-04-07 at 1.14.38 pm

Source: RBA.

Tips to deal with credit card debt

Call your bill providers (energy, telco etc) and ask for a temporary reprieve.
Cut back on non-essential spending until your credit card is back in the black.
Ask your credit card provider for a reduced interest rate or consider switching to a low-rate card.
An alternative is to switch your debt to a personal loan which forces you to pay the debt back in full.
Once you’ve cleared your debt, consider dropping your credit card limit or cutting up the card altogether.

Disclaimer

This article is over two years old, last updated on April 7, 2022. 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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This article was reviewed by Research Director Sally Tindall before it was published as part of RateCity's Fact Check process.

Laine Gordon

Money Editor

Laine Gordon is the Money Editor at RateCity and an experienced journalist and research specialist. With a background in news and feature writing, covering finance, media and even food (a passion of hers) at Reed Elsevier publications, Laine brings almost two decades of experience to the team. Having covered major areas of interest to the general public from hip pocket issues to rising and falling interest rates and the impact to mortgages, credit and saving in Australia, she is passionate about researching and telling people’s stories to help others make better decisions about their own finances.