The national credit card debt accruing interest has continued to tumble in lockdown, dropping by $582 million in the month of August, according to RBA statistics released today.
This takes the national credit card debt on personal cards to $18.32 billion in original terms – the lowest level since January 2004.
The drop comes on the back of a significant fall of $1.11 billion the month prior. As a result, credit card debt has fallen by $1.69 billion in just two months since the start of the Delta lockdowns (July and August 2021).
Credit card statistics: personal credit cards in August - excludes commercial cards
|Amount||Monthly change||Year-on-year change|
|Number of accounts|
lowest since December 2006
|Balances accruing interest|
lowest since January 2004
|Value of transactions|
Source: RBA, released 7 October 2021, original data, excludes commercial cards. Monthly change is July – August 2021, year-on-year change is August 2020 to August 2021.
RateCity.com.au research director, Sally Tindall, said the slide in credit card debt was likely to continue for the duration of lockdown.
“As tough as they are, lockdowns have been incredibly effective in getting people to focus on their personal finances,” she said.
“Many families have realised credit card debt is public enemy number one and clearing it has become a priority.
“At this pace, we could see credit card debt accruing interest drop below $18 billion next month, however beyond this, credit card debt could stagnate or worse still, tick up.
“With Christmas around the corner, and COVID relief payments starting to wind up, people could start falling back into old habits if they’re not careful.
“At just over $18 billion in credit card debt, there’s still plenty of work to be done but we’ve come a long way in a relatively short space of time. Just five years ago the national credit card debt was north of $31 billion.
“The concern, however, is some people are swapping one form of credit for another.
“The meteoric rise of buy now, pay later has put a significant dent in credit cards, but people need to be careful they’re not swapping one credit addiction for another,” she said.