Survey Finds Australians Know Their Fees yet Still Pay Regular Penalty Fees

A survey that was undertaken by CoreData Australia has shown that even though Australian people know the exact fee rates on their credit cards, almost 50% have still managed to miss a monthly repayment or didn’t manage to pay the minimum required.

It has been concluded that Australians, increasingly, are ignoring the cost of fees despite being aware of them.  This has been further demonstrated by a News Digital Media survey which found that one third of participants did in fact know their credit card’s rates.

Here are the credit card survey results from April through June 2009 in Australia:

• 43.9% of the participants who were in the survey knew their interest rate with an accuracy of within 1.00% of their official rate
• 55% of participants knew exactly how many interest-free days their credit card was offering them – strange, too, that 55 days is the standard length for interest-free periods!
• 44.8% of participants had paid their credit card balances in full throughout the survey time period.  This statistic matches the latest trends in credit card debt repayment that Australians have been demonstrating.
• 12.8% of participants were just getting by paying the minimum repayments
• 55.2% of participants had been required to pay a surcharge or fee if they were to pay via credit during the time of the survey.  This is not uncommon, since merchants have to cover their credit card payment processing fees and costs.  Many businesses pass this cost onto the consumer, but this is not really considered fair as there are payment alternatives to credit cards which many customers utilise.
• 68.6% of the survey participants were male.
• About 35% of the males in the survey had an annual household income of $75,000.

As can be seen, it’s still uncertain to what extent Australians are savvy on their credit card details and rates.  This is shocking on the one hand, as credit cards allow Australians to rack up a lot of debt, potentially very quickly!  Even though credit cards are useful for emergencies, they are fast becoming necessities for Australian people.  One wonders that all credit card holders are not more particular about knowing the hidden rates and fees that they’ll be required to pay.  On the other hand, credit card companies do make it incredibly complicated and difficult to understand the rules and fees required by each card.  Many people have wondered if the companies are keeping us all a little bewildered as this way, it makes it harder for the consumer to choose between cards based on rates, fees, timeframes and pros/cons in a rational way…!

However, it’s very hard to prove anything… The fact is, though, that you would do well to know your credit card’s rates and fees and to manage the fees and interest rates competently, to save yourself money and stress.

Unfortunately, many Australians aren’t managing it. While many third party studies keep revealing new figures, and even the official Reserve Bank’s statistics are released on a monthly basis, results seem to fluctuate from survey to survey.

Something you should know about credit card fees – but probably don’t – rates can change without notice!  Even if you’re in the habit of making payments in time for your credit card, the bank or credit company may raise your interest rate automatically if you are late on payments in other areas – for instance, on another card, or for a phone, car or mortgage payment plan.  Or even because the bank thinks that you’ve now got too much debt – they can raise interest automatically even in this instance.  This is called the “universal default” clause in the credit card agreement and it’s becoming standard more and more.  The logic is, that it’s not unreasonable to increase interest rates for a customer who has become more “risky” to the credit company.  That’s because they think that a credit card holder who has a lot of debt is more likely to start defaulting on their payments.

So it’s in your best interest to keep checking with your credit card company to make sure they haven’t changed the rates without you noticing.  Not everyone will know your credit score, but your credit card company sure will!  And they might change your interest rates without telling you – so make sure you keep on top of it by regularly calling or logging in to double check.

Need help working it all out?

If you’re having trouble working out which card has which kind of fees and rates, check out the Credit Card Finder®.  Credit Card Finder® allows consumers to compare different credit cards in an easy-to-digest comparison chart form and the tables display all of the important rates, fees and relevant facts that you need to know.

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