More action should be taken to limit excessive credit card interest rates

More can be done to keep excessive credit card interest rates under control. 

The unexplained gap between the cash rate and the current credit card rates will be discussed at the Budget Estimates inquiry.calculator coin money save debt

Reserve Bank of Australia officials will reportedly be questioned over the swelling gap between credit card interest rates and the cash rate, with Australia’s biggest credit card comparison website urging more action needed to help keep credit cards under control.

Although the cash rate has dropped by 2.75 percentage points since 2011, the average standard credit card purchase rate is relatively unchanged at 19.75 percent, leaving Senators asking two Reserve Bank assistant governors why the 2.75 percentage points worth of savings have been kept from cardholders.

What can be done?

Michelle Hutchison, Money Expert at, said more can be done to keep credit card rates under control.

“It’s finally come to public attention that many consumers could be feeling ripped off with their credit card rates as most credit cards haven’t passed on the Reserve Bank cash rate cuts since 2011.

Credit Card providers are under greater pressure to keep up with past profits and growth, as credit card holders are tightening down on their credit card use by paying more of their balance off each month.

In fact, the total balance accruing interest has been steadily falling since 2011.

However, more can be done to help consumers get a better deal on their credit cards.”

For instance, it could be a good idea to introduce a cap on interest rates to limit excessive rates being offered.

Currently, the most expensive credit card purchase rate is 25.90 percent while the most expensive cash advance rate is 29.49 percent.

“But there’s no reason to wait for the outcome of the meeting, cardholders should find a better deal now and stop paying too much interest.”

According to, the lowest ongoing credit card purchase rate is 7.99 percent by Quay Credit Union and there are 72 cards that offer no interest on new purchases for up to 13 months.

Also, 157 credit cards are offering 0 percent interest for balance transfers for up to 24 months and 50 cards charging no annual fees.

“We’ve never seen so many promotions for credit cards.

If more cardholders took advantage of these deals and shopped around, this would force providers to be more competitive with their credit cards.”


Subscribe & don’t miss a single episode of Michael Yardney’s podcast

Hear Michael & a select panel of guest experts discuss property investment, success & money related topics. Subscribe now, whether you're on an Apple or Android handset.

Need help listening to Michael Yardney’s podcast from your phone or tablet?

We have created easy to follow instructions for you whether you're on iPhone / iPad or an Android device.


Prefer to subscribe via email?

Join Michael Yardney's inner circle of daily subscribers and get into the head of Australia's best property investment advisor and a wide team of leading property researchers and commentators.

Michael Yardney


Michael is a director of Metropole Property Strategists who help their clients grow, protect and pass on their wealth through independent, unbiased property advice and advocacy. He's once again been voted Australia's leading property investment adviser and one of Australia's 50 most influential Thought Leaders. His opinions are regularly featured in the media. Visit

'More action should be taken to limit excessive credit card interest rates' have 1 comment


    February 3, 2017 Bruce

    WHY is my money worth around 2% to the bank but there`s is worth a whopping 21% if I borrow ????? – feeling ripped off has to be the biggest understatement of the century !!!! This bloody government must get onto top of this profiteering !!!


Would you like to share your thoughts?

Your email address will not be published.


Copyright © Michael Yardney’s Property Investment Update Important Information
Content Marketing by GridConcepts