Credit card balances are falling

Credit card balances accruing interest fell 1.9 per cent, from $36.1 billion to $35.4 billion, in 2012 according to the RBA.

Ten credit card issuers surveyed by the Australian Prudential Regulation Authority increased the size of their credit card portfolios by an average of 2.1 per cent last year.

MWE Consulting's principal, Mike Ebstein, said the figures for 2012 highlighted the low rates of growth and of credit and charge card balances; the ongoing shift to debit; and a shift from cash to card spending.

Ebstein said debit cards accounted for 40.7 per cent of the value of card transactions and 62.9 per cent of the volume. Back in 2007, debit cards accounted for 32.3 per cent of the value of card transactions.

Source: Banking Day