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Australians have ‘alarming lack of knowledge’ about credit card rates

by Staff Reporter10 minute read
The Adviser

Many consumers are unsure how much credit card interest they are paying and which institutions offer the best rates, a poll has found.

The Customer Owned Banking Association poll found that 46 per cent of respondents who used credit cards for buying Christmas gifts did not know the interest rate for their card.

Twenty-seven per cent said their interest rate was more than 15 per cent, 16 per cent said it was between 11 and 15 per cent, and 12 per cent said it was 10 per cent or less.

Mark Degotardi, chief executive of the Customer Owned Banking Association, said many people will get “a rude shock” when they receive their Christmas credit card bills.


“This research shows that Australians have an alarming lack of knowledge about the credit card interest rates they pay and who offers the best deals,” he said.

“Consumers are clearly forking out much more than they need to. It’s worth digging a little deeper to make sure you’re getting the best deal on your credit card.”

The poll also revealed that 65 per cent of respondents – and 62 per cent of those using credit cards – were unsure which institution offers credit cards with the lowest interest rates.

Of all the respondents, 11 per cent said the big four banks had the lowest credit card interest rates, while 9 per cent believed customer-owned banks had the lowest rates.

Retailers such as Coles and Myer were thought to have the lowest rates by 8 per cent of respondents, and 3 per cent said regional banks had the lowest rates.

Foreign banks, airlines such as Virgin or Qantas, and American Express were each thought to have the lowest rates by 1 per cent of respondents.

[Related: FHB habits could be ‘recipe for disaster’]