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Stubborn credit card debt remains stuck at $20 billion

Liz Seatter avatar
Liz Seatter
- 3 min read
Stubborn credit card debt remains stuck at $20 billion

Australia’s stubborn credit card debt has now hovered at around $20 billion for eleven months in a row.

The latest RBA data for personal credit card accounts shows a slight month-on-month decrease of 0.3 per cent in June, taking the total credit card debt accruing interest to $20.01 billion, in original terms.

Note this data excludes commercial credit cards.

Debt graph june rba.JPG

Source: RBA, June 2021 data, released 9 August 2021, original data, excludes commercial cards.

While credit card debt has remained relatively steady for 11 months in a row, the number of credit card accounts has dropped by 751,916 in the last year, to the lowest number since February 2007. However, the rate at which people are closing accounts has slowed, compared to a year ago.

Credit card statistics: personal credit cards in June

Amount  Monthly change  Year-on-year change
Number of personal accounts

 12.52 million
lowest since Feb 2007

-29,171
-0.2%

-751,916
-5.7%

Balances accruing interest

$20.01 billion

-$52.0 million
-0.3%

-$2.78 billion
-12.2%

Value of transactions

$22.05 billion

-$197.4 million
-0.9%

$1.53 billion
7.4%

Source: RBA, released 9 August 2021, original data, excludes commercial cards. Monthly change is May – June 2021, year-on-year change is June 2020 to June 2021.

RateCity.com.au research director, Sally Tindall, said: “Millions of Australians appear to be stuck in a credit card debt rut.”

“Debt accruing interest has hovered around $20 billion for almost a year,” she said.

“However, debt accruing interest could climb next month if lockdown affected households have reached for the credit card to help pay the bills.”

In June, Melbourne was locked down for a week, while greater Sydney’s restrictions started on 26 June. The July data, due out next month from the RBA, will be a better indication of how Australians are using their credit cards in lockdown, with multiple states affected that month.

“If you’re struggling to pay the bills, pick up the phone and ask for help instead of reaching for the credit card,” she said.

“Putting your bills on the credit card or taking out a payday loan could make a bad situation worse.

“There are support packages from the government, loan deferrals, rate reductions and fee waivers from the banks, crisis payments from Centrelink and hardship programs from essential service providers,” she said.

Anyone struggling with debt can call the National Debt Helpline for free financial counselling.

National Debt Helpline: 1800 007 007

Accounts june rba data.JPG

Disclaimer

This article is over two years old, last updated on August 10, 2021. 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 home loans articles.

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Product database updated 26 Feb, 2024

This article was reviewed by Head of Public Relations Laine Gordon before it was published as part of RateCity's Fact Check process.

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