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CBA increases interest rate on select credit cards

Eden Radford avatar
Eden Radford
- 5 min read
CBA increases interest rate on select credit cards

CBA, Australia’s largest bank, has increased the interest rate on a range of credit cards by up to 1.25 percentage points.

The bank is also raising the international transaction fee on select credit cards from 1 December 2023 (see further below).

From today, the interest rate on eight of CBA’s credit cards will rise to 20.99 per cent.

These changes follow CBA’s increase to the purchase rate on its Low Rate card on 25 August, where the rate was hiked 0.75 percentage points to 13.99 per cent. This rate has not been changed today.

Changes to CBA’s credit card fees and rates, effective 1 November

CardOld RateNew RateChange
Low Fee19.74%20.99%1.25%
Smart Awards20.24%20.99%0.75%
Ultimate Awards20.24%20.99%0.75%
Old cards – not available to new customers
Low Fee Gold19.74%20.99%1.25%
Gold Awards20.24%20.99%0.75%
Platinum Awards20.24%20.99%0.75%
Diamond Awards20.24%20.99%0.75%

Source: RateCity.com.au

These rate increases will put the interest rates on these CBA cards in highest 15 per cent of all cards on the RateCity.com.au database. The database shows, of the purchase rates:

  • 17.01% is the average credit card interest rate.
  • 25.80% is the highest credit card interest rate.
  • 14 lenders offer at least one credit card with an interest rate under 10%.
  • 5 lenders offer a 0% card, however, fees apply instead.

International transaction fees also increasing on select cards

CBA has also announced an increase to the international transaction fee on select credit cards of 0.50 percentage points to 3.50 per cent, effective 1 December 2023.

The new rate will apply to the following cards:

CBA cards
Low Rate
Low Fee
Old cards – not available to new customers
Commbank Essentials
Low Rate Gold
Gold Awards
Platinum Awards
Diamond Awards

Source: RateCity.com.au

The RateCity.com.au credit card database shows:

  • 3.65% is the highest international transaction fee on 6 cards from 4 lenders.
  • 3.50% is now the highest international transaction fee currently offered from a big four bank.
  • 3.00% is the most common international transaction fee.
  • 17 cards from 9 lenders have no international transaction fees, including 3 cards from CBA (Ultimate Awards, Smart Awards and Neo cards).

RateCity.com.au research director, Sally Tindall, said: “CBA has hiked the interest rate on a range of credit cards today, some by over a full percentage point.”

“While this won’t bother people who fastidiously pay their balance, the last thing customers carrying around credit card debt need is a higher interest rate,” she said.

“If you’re someone who can’t clear their credit card bill every single month, you should not be holding a card with a rate that’s over 15 per cent – even 10 per cent is too high.

“There are 14 cards on the market offering rates under 10 per cent, along with five cards that charge fees instead of interest.

“At 3.50 per cent, CBA now has one of the highest international transaction fees in the market, but only on select cards.

“International transaction fees aren’t like death and taxes – you don’t just have to cop them. While the majority of cards sting you with a rate of 3 per cent for making a purchase overseas, there are nine cards on the market that waive these currency conversion fees, including three from CBA.

“These credit card changes from Australia’s biggest bank are a good reminder to make sure you have a card in your wallet that suits your finances.

“The credit card market offers over 180 options from 60 different lenders. While there’s plenty of choice, the trick is making the right choice.

“Sometimes that can mean not having a card at all,” she said.

Tips for picking a credit card that suits your finances, if you are a:

Big spender: a rewards card could work in your favour but only if you get back in perks what you pay for in fees. If you pay any interest on the card, it could be sending you backwards.

International shopper: a card offering 0 per cent international transaction fees could help you avoid currency conversion charges, but only if it doesn’t then sting you elsewhere.

Nervous Nellie: if you only want a credit card in case of emergency, look for a low-rate card, ideally with a competitive interest rate as well.

Budget balancer: if you get caught out from time to time with bills you can’t clear, consider looking for a low-rate card, ideally with a low credit limit to avoid temptation.

Debt addict: if you pay interest charges on a regular basis on any of these cards, then you’re officially on a debt treadmill. It’s time to cut off the credit card umbilical cord and find a new way to balance your budget.

Lowest rate credit cards on RateCity.com.au database

(excludes 0% interest cards)

Card Purchase rateAnnual fee
G&C Mutual Bank Low Rate7.49%$50
Easy Street Easy Low Rate8.99%$40
MOVE Bank Low Rate8.99%$0 for first 12 months then $59
Community First Bank Low Rate8.99%$40
Defence Bank Foundation Visa3.99% for 6 months then 8.99%$45

Source: RateCity.com.au. Credit scores apply.

0% credit cards

Card Interest rateFees
CBA Neo0%$12-$22 p.m.
No fee if $0 balance, and card not used that month.
Westpac Flex0%$10 p.m.
No fee if $0 balance.
NAB Straight Up0%$10-$20 p.m.
No fee if $0 balance, and card not used that month.
Community First n0w0%$9-$19 p.m
No fee if $0 balance, and card not used that month.
Transport Mutual Clement0%$10 - $30

Source: RateCity.com.au

Compare credit cards

Product database updated 20 May, 2024

This article was reviewed by Research Director Sally Tindall before it was published as part of RateCity's Fact Check process.