Consumers rein in credit card limits

Consumers spent more on their credit and charge cards over the past year, but they reduced their average monthly balances and their average credit limits.

The cut in average credit limits - a trend almost certainly driven by household decisions rather than curbs by banks - led to a fall in the aggregate limit of all credit cards in January 2012.

Credit and charge card-holders spent an average of A$16,098 on their cards in the 12 months to January, compared with $15,643 in the 12 months to January 2011.

According to MWE Consulting's latest Australian Payment Cards Report, all the growth in spending came from commercial cards. Personal spending on credit and charge cards was flat.

The average account balance in January was $3263 - down from $3350 in December. MWE Consulting said there has been no increase in the annual rate of growth for card balances since November 2010.

The average credit limit fell from $9138 in December to $9113 last month.

The number of personal credit card accounts increased by 2.2 per cent over the 12 months to January. In contrast, the number of charge and commercial credit card accounts fell by 2.5 per cent over the same period.