Positive signs for credit card market
Credit card numbers are starting to look positive. Reserve Bank data issued yesterday shows the number of accounts is rising steadily, the value of cash advances and purchases has picked up in recent months, credit limits are growing and so are account balances accruing interest.Consumers made purchases worth A$21.5 billion on credit and charge cards in April ($1,400 on each account). Purchases were up 6.7 per cent on the previous month. They have increased by 8.1 per cent since January. Cash advance values have increased from a low of $751 million, in February, to $864 million, in April.Balances accruing interest fell steadily throughout 2012 and reached a low of $35.01 billion last September. Since then balances have bounced around and were stuck at $35.02 billion in March. But they jumped 3.2 per cent in April, to $36.15 billion.The impression that the credit card market is turning around is backed up by Australian Bureau of Statistics' lending data issued yesterday. Personal lending was up 5.2 per cent in April.However, Mike Ebstein of MWE Consulting pointed out that the long-term trend in the credit card market is still weak. The annual rate of growth on card spend was up just 3.6 per cent.The average balance increased by just 0.1 per cent over the 12 months to April, and the annual increase in the average credit limit was just $16.Ebstein said the growth in spending is coming from consumers. Commercial card users have trimmed back their spending.