Credit card users not given enough help, experts say
14 May 2020
While home loan and business owners have received extensive financial aid, it’s credit card customers who have pulled the short straw in the COVID-19 pandemic.
Over recent months, we’ve seen the rollout of financial assistance from banks and financial institutions but perhaps not enough focus on credit - at least that’s what some experts believe.
“Unsecured credit has been the poor cousin in all of this [pandemic],” said director of policy at the Consumer Action Law Centre, Katherine Temple. “A lot of [other banks] responses are kicking the can down the road.”
Deferring repayments, purchase rate reductions and lowering the minimum repayment amount for vulnerable customers are measures that have been put in place. However, there’s one area that may have been overlooked. Accruing interest.
RELATED: Four credit card tips for financially strapped times
According to J.D Power, 26% of Aussies are using their plastic to pay for household necessities. So, if you own a credit card with an interest rate over 20%, you may find yourself with some challenges once the deferral period ends: a stack of built up debt, higher repayments and a hefty interest bill to match.
According to Mozo Director, Kirsty Lamont, there are a few things Aussies can do now to prepare themselves for the future.
“It’s crucial that credit card holders familiarise themselves with smart ways to pay down their debt, so that when the time comes, they are fully equipped to do so,” says Lamont.
“One course of action might be to apply for a balance transfer credit card, which can wipe away debt without the interest.
“It’s important to prepare a realistic repayment plan, so you’re guaranteed to clear your balance before the 0% interest rate period ends. Otherwise, you could find yourself with a revert purchase rate much higher than what you initially started with.”
RELATED: Get on top of debt! 4 smart ways to pay off your credit card
If you’d like to find out how much you could save in interest by taking out a balance transfer credit card, check out some offers below or head on over to our comparison tool for more options.
And if you haven’t been keeping up with the latest COVID-19 developments, check out our coverage of all the credit card relief packages banks offer.
Compare balance transfer credit cards
Rates updated daily. Advertiser disclosure.
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Apply By 04 October 2021
Kogan Money Black Card
0% p.a. for 12 months and then 21.74% p.a.
20.99% p.a.
$0
Kogan Money Black Card has no annual fee and no cap or expiry date on points. It comes with a 55 interest free days on purchases and a 0% balance transfer rate for the first 12 months. Earn up to $400 in Kogan.com Credit, $50 Credit on first eligible spend in 30 days and $350 Credit when you spend $1,500 on eligible purchases in 90 days from card approval.
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20.99% p.a.
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0% p.a. for 12 months and then 21.74% p.a.
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21.74% p.a.
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55
-
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3.40%
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$0
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$30.00
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3.50%, min $5.00
Read our Mozo Review to learn more about the Black Card
Details Close
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Great Southern Bank Low Rate Credit Card
0% p.a. for 25 months and then 21.74% p.a.
11.99% p.a.
$49 $0 in the first year
0% balance transfer rate for 20 months and up to 55 interest free days. No annual fee for the first year and $49 after. Mozo Experts Choice Balance Transfer Platinum Credit Card Winner 2020^
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11.99% p.a.
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0% p.a. for 25 months and then 21.74% p.a.
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21.74% p.a.
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55
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0.0
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3.40%
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$49 $0 in the first year
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$12.50
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2.00%, Min $3.50
Read our Mozo Review to learn more about the Low Rate Credit Card
Details Close
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Apply By 31 October 2021
Bendigo Bank Low Rate Credit Card
0% p.a. for 12 months and then 11.99% p.a. (2.00% balance transfer fee)
0% p.a. for 12 months then 11.99% p.a.
$45
0% p.a. on purchases for up to 12 months (Reverts to 11.99% p.a). Also 0% balance transfer for up to 12 months. Low annual fee of $45 and no fees for additional cardholders.
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0% p.a. for 12 months then 11.99% p.a.
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0% p.a. for 12 months
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0% p.a. for 12 months and then 11.99% p.a. (2.00% balance transfer fee)
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13.99% p.a.
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55
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3.00%
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$45
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$15.00
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0.50%, Min $3.25
Read our Mozo Review to learn more about the Low Rate Credit Card
Details Close
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Apply By 28 October 2021
PayPal Rewards Card
0% p.a. for 20 months and then 20.99% p.a.
20.99% p.a.
$0
Enjoy 50,000 bonus points (conditions apply). Receive 55 interest free days on purchases and 0% balance transfer rate for the first 20 months.
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20.99% p.a.
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0% p.a. for 20 months and then 20.99% p.a.
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21.74% p.a.
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55
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3.40%
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$0
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$30.00
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3.5%, Min $3.50
Read our Mozo Review to learn more about the Rewards Card
Details Close
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^See information about the Mozo Experts Choice Credit cards Awards
