Figures released from the Reserve Bank show that the average credit card balance fell by $19.50 (0.6 per cent) in August to $3,172.20 – the lowest result in almost 4 years (since November 2009). The average credit card balance was 2.7 per cent below a year ago. In smoothed terms (12 month average) the average balance was down by 2.5 per cent – the biggest fall in 19 years of records.
Of credit cards attracting interest charges, the average outstanding balance slumped by $67.80 in August to $2,221.50. The average balance accruing interest is down by 6.4 per cent on a year ago and down by a record 4.8 per cent on a year ago in smoothed terms.
The average credit card limit rose by $12.70 to $9,094.60 in August. The average credit card limit rose by just 1.4 per cent in the year to August. Credit card holders, on average, used only 34.9 per cent of credit card limits in August – the lowest rate in 11½ years (since December 2001).
The average number of transactions on credit cards in August was 10.2, down from 11.0 in July. In smoothed terms the average number of credit card transactions was 10.26 in August – a record high.
The average number of transactions on debit cards in August was 7.9, up from 7.8 in July. In smoothed terms the average number of credit card transactions was 7.46 in August – a record high.
The number of credit card cash advances fell by 9.5 per cent in August (value down by 6.1 per cent). In smoothed terms, credit card advances are down 2.5 per cent on a year ago and have consistently fallen in the past five years.
The number of ATM withdrawals in August was down by 3.7 per cent on a year ago. In smoothed terms, ATM withdrawals were down by 4.4 per cent on a year ago and they have fallen consistently over the past year.
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific's leading geo-politics and economics portal.
He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.
