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Are Aussies in a micro-debt crisis? A study by

Written by

Shaun McGowan

About the study commissioned an independent survey of 732 credit card holders to gauge whether Aussies were still paying off last year’s credit card debt in 2020, as well as how long it would take for them to clear their debt. The survey also sought to uncover credit card habits such as the main expenditure categories from which Aussies are incurring debt, how much interest consumers are paying across all their cards, and whether their credit card debt is worsening.

High levels of credit card debt can have a negative impact on an individual's credit score, and could be a real issue if the person applies for a home loan down the line.

Are Aussies in a micro-debt crisis?

By July, more than a third (38 per cent) of credit card holders will still be paying off their credit card debt incurred last year. Concerningly, one in five (21 per cent) credit card respondents – and 25 per cent of those in their 40s – won’t pay off their debt this year at all.

What accumulative credit card limit do Aussies have across all their cards?

More than a third (37 per cent) of credit card holders have a credit limit of $10,000 or more across all their cards, and 60 per cent have a limit of at least $5000. Specifically, a quarter (24 per cent) of credit card holders have a limit of $2000-5000, 23 per cent of respondents’ credit cards sit at an accumulative total limit of $5000-10,000, and 17 per cent have a card limit of $10,000-15,000 across all their cards.

More older Aussies have a credit card limits of $10,000 or more across all their cards: 43 per cent of over-60s have this level of limit, compared with an equal 36 per cent of those in their 40s and 50s. Meanwhile, younger credit card holders are more likely to have a lower credit limit across their cards, with 50 per cent of under-30s having a total credit limit of up to $5000.

How much credit card debt did Aussies rack up last year?

The majority of debt Aussies had accumulated on their credit cards when their debt was at its highest was relatively low: 39 per cent said less than $2000, and 68 per cent said up to $5000. Just nine (9) per cent had accumulated more than $10,000 in card debt. Specifically, 29 per cent racked up $2000-5000 worth of debt, and 12 per cent had $5000-7000 at any one time last year across their cards.

Older Aussies are more likely to be on the lower end of the spectrum with their credit card debt. Seventy-nine (79 per cent) of over-60s had a combined card debt of up to $5000 last year at any one time. This compared with 57 per cent of 30-somethings and 64 per cent of under-30s. Meanwhile, Aussies in their 30s had the highest total debt across all their card at any given time last year, with 14 per cent having a debt of $10,000 or more.

Across the States, more South Australian credit card holders had up to $5000 in debt before the pandemic than any other State, at 81 per cent. This compares with an equal 68 per cent of NSW, Victorian, and Queensland card holders.

What are the big-spending categories for credit card debt?

Nearly half (48 per cent) of respondents admitted that the major expenditure category causing their credit card debt is essential purchases. Groceries and essentials are the main category incurring debt for 28 per cent of credit card holders, while 20 per cent say their debt is from insurance, internet, phone, energy and other utilities bills.

Nineteen per cent (19 per cent) incur most of their card debt from holidays and leisure activities, while nine per cent said it is due to entertainment and dining.

The major expenditure category incurring card debt for under-30s is holidays and leisure activities, with 28 per cent admitting this. This compared with 16 per cent of over-60s and 12 per cent of respondents in their 40s. Meanwhile, groceries and essentials is the major category incurring debt for the other age groups: 34 per cent of those in their 30s, 32 per cent of those in their 40s and 26 per cent of those in their 50s.

Across the major States, the biggest non-essential spending categories tend to vary. ACT residents incur the most debt on entertainment and dining (chosen by 23 per cent), NSW and Victorian residents accumulate debt from holidays and leisure activities (21 per cent and 20 per cent, respectively).

How much interest are Aussies incurring across their credit cards?

Aussies struggling to stay on top of their credit card debts are also getting hit with interest that can stack up significantly over a 12-month period. The survey results show that nearly a third (31 per cent) of credit card holders pay at least $360 a year in interest, on average. Eighteen per cent pay an average of at least $600 each year on interest, while a concerning eight per cent pay $1200 or more each year.

The results show that 30-somethings are more likely to pay nearly $1000 at minimum on interest: 13 per cent pay $960 or more a year across all their credit cards. On the other hand, seniors are keeping their purse string tight when it comes to paying interest, with 77 per cent saying they pay less than $120 a year across all their cards.

Will Aussies ever be able to pay off their debts? asked respondents if they had ever felt they would not pay their debts off completely. The results reveal that a third (34 per cent) of credit card holders felt it would take at least a year to pay off last year’s debt. Specifically, a quarter (25 per cent) felt that it would take at least two years to pay off, while 13 per cent felt they would never be rid of their credit card debt.

Of concern, younger Aussies seem to feel more trapped by their credit card debt, with 50 per cent of those under 30 and 49 per cent of those in their 30s feeling as if they will never pay it off. This compares with just 17 per cent of over-60s.

Is our micro-debt crisis getting worse?

Concerningly, one in five (20 per cent) of Aussies felt their credit card debt was getting worse, with almost a quarter (24 per cent) saying they didn’t think they could make ends meet on a weekly basis without a credit card.

The results show that younger Aussies are more likely to have debt piling up, with a third (34 per cent) of those aged 18-29 and 32 per cent of those in their 30s saying they feel their credit card debt is getting worse. This is compared with 22 per cent in their 40s, 16 per cent of 50-somethings, and nine per cent of over-60s.

How could Aussies try to avoid high-interest rates from credit cards?

Watching interest stack up on credit card debt can be concerning, but have you ever considered transferring that debt onto a personal loan with a lower interest rate? This is a common alternative to doing a credit card balance transfer to a different credit card.

A third (32 per cent) of Aussies overall – and 49 per cent of those aged between 18-29 – said that when their card debt was at its highest, they would have considered it.

Older Aussies, on the other hand, are far less likely to take out a personal loan in this situation. Most (91 per cent) of those over-60 and two in three (69 per cent) in their 50s years saying they wouldn’t consider doing so.

About the Author

Shaun McGowan from



Shaun McGowan

Shaun is the founder of and is determined to help people pay as little as possible for financial products. Through education and building world class technology. Previously Shaun co-founded and Lend.


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