Aussies wipe out credit card debt with Rudd bonus

Wednesday 27 May 2009

Article by Mozo

Cash savvy Australians benefiting from the latest round of government handouts are using the money to pay off their credit card debts, new figures have revealed.

According to the Reserve Bank of Australia’s (RBA) latest statistics, credit card repayments surged by 17.5 per cent in March 2009, which coincided with the second round of government cash payouts to 1.5 million Australians working in the retail industry.

Commonwealth Securities economist Savanth Sebastian is quoted by Perth Now as saying: "While there is no doubt that consumers spent significantly [in March], it seems a significant proportion of that stimulus was also used by households to pay down debt."

The cash handouts formed part of a $42 billion stimulus package, the first round of which was paid out last December when a similar jump in credit card repayments was also recorded.

The RBA statistics also revealed that spending in March by a total of 2.2 per cent compared to February, according to the website.

RBA’s board recently expressed its dissatisfaction regarding a perceived ‘lack of progress’ regarding revisions to interchange fees regulation across the financial sector.

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