Personal credit card accounts hit 10-year low

The number of personal credit card accounts in Australia fell by 6.2 per cent over 2019 to 13.8 million - the lowest level since 2010.

The latest Reserve Bank payments data shows that the volume and value of payments made using credit cards has held up reasonably well over the years, without much growth, but card account numbers and balances accruing interest have been in decline for years.

The value of balances accruing interest on personal cards fell 9.2 per cent to A$27.1 billion last year.

The commercial credit card market is declining even faster, with the number of accounts falling 27 per cent to 862,000 last year and the value of balances accruing interest falling 31.7 per cent to $1.2 billion.

According to Michael Ebstein from MWE Consulting, an average credit or charge card account had a balance of $3384, a credit limit of $9848 and an annual spend of $22,094 in December.

MWE says a notable feature of the payments market in 2019 was that debit overtook credit and charge in the annual value of purchases: $337 billion on debit and $334 billion on debit and charge.

The switch in usage from credit to debit has been accompanied by a decline in average purchase value. Over the past 10 years the average spend on a card has fallen from $100 to $64.53 in December.