A record $49.4 billion in credit card debt is owed by Australians, as households rely on their credit cards to cope with rising living costs.
Recent statistics from the Reserve Bank of Australia reveal that total credit card balances have surged by nearly 45 per cent over the past five years, reaching $49.4 billion as of May, with $37 billion of this amount incurring interest.
The total number of credit and charge card accounts is about to surpass 15 million, reflecting an increase of nearly 20 per cent in the last five years, with the average debt standing at $3322 per card.
Nonetheless, the actual credit card debt for the typical family is expected to be significantly higher, as many households struggle to manage repayments across multiple cards.
This enormous debt accumulation is likely to continue growing without end, as numerous lenders impose interest rates on credit card accounts that are four times higher than the official RBA cash rate of 4.75 per cent.
An astounding more than two-thirds of consumers’ outstanding debt is accumulating interest at an average rate close to 20 per cent, marking a two-decade high.
