Credit Card Spending Soars

Credit Card spending is still on the rise according to RBA statistics from February, 2010

It seemed that consumers in Australia were slowing down on their credit card spending for months due to the worldwide financial crisis. They were also trying to pay off the balances on their credit card during this time. The Reserve Bank of Australia is showing new figures from February 2010 that indicate that transactions on charge and credit cards have risen sharply.

Credit card spending is on the rise

All the signs are there that credit card balances and usage are rising again even though the figures indicate a fall from the same time period during 2009.

Card balances increasing

In February 2010 the balance on national credit cards increased according to the Reserve Bank of Australia. The total balances on charge and credit cards that were outstanding rose from $46.152 billion to $47.124 billion. This is a 2.1% increase. Over the past year this is a 5.1% increase.

To sum it up, the average balance on credit cards in February was up 2% from January and stood at $3250. This is a rise of $55 from the statistic reported in November 2009. The average balance on a credit card was 3.29% higher in February than it was at this time last year.

Transaction values rising

In February the total value of charging credit card transactions was $18.2 billion. This figure includes cash advances. In January card transactions were $17.1 billion, so this indicates a rise of 6.05%. Figures have increased this year but are less than last year when $20 billion was spent on charge and credit cards across the nation during the month of February.

More purchases are being made

The value of credit card spending increased from $16.322 billion in January to $17.321 billion in February, which is an increase of 6.1%. This is also a 7.1% rise over last year to February 2010, and indicates that consumer spending behavior is loosening up.

Credit card spending with EFTPOS transactions, which includes both cash-outs and purchases, went down from $160.92 million in February to $173.18 million during the previous month. There was, however, a rise in EFTPOS transactions of 9.96% from the previous 12 months. There was also a rise in the value of cash advances on charging credit cards in February. When compared to January that had $855 million worth of advances made, February had an increase of 4.8% with $896 million worth of cash advances completed. These cash advance rates decreased by 6.95% when compared to the $963 million worth of advances made in February 2009.

Repayments have decreased

There was a fall in repayments made to charging credit cards in February. January’s figures show $18.593 billion being repaid while February shows $17.716 billion. When compared to a year ago, however, they are still on the rise and up 5.5% from the previous February.

Credit card spending has risen since the economic crisis has slowed down and people feel more confident reaching into their pockets and pulling out their credit card. These statistics support that fact.

Comparison of our Top Credit Card Offers

		Interest Rate (p.a.)	Balance Transfer Rate (p.a.)	Annual Fee	Cash Advance Rate (p.a.)
Bankwest Breeze MasterCard	A low interest rate on everyday purchases with a low balance transfer offer	0% for 6 months (reverts to 10.99% )	4.99% for 9 months	$49	21.99%
Citibank Clear Platinum Card	A low interest rate offer on balance transfers and purchases	11.99%	0% for 12 months with 3% handling fee	$99	21.74%
St.George Vertigo	An introductory offer on balance transfer and a low annual fee	13.24%	0.99% for 6 months	$55	21.49%
Virgin Flyer Credit Card	Earn 1 velocity point per $1 spent, plus an introductory offer on balance transfers	20.99%	1.9% for 12 months	$50 (for first year thereafter $99)	20.99%
Westpac 55 Day Credit Card	No annul fee for the first year with a low rate on balance transfers and purchases	0% for 5 months (reverts to 19.59% )	3.99% for 6 months	$0 annual fee for the first year ($30 thereafter)	21.49%