Credit cardholders could save $500 every year with low rate cards

Even while the lowest rate credit card could save the average credit cardholder $466 in fees and interest every year, there aren't enough options for consumers to choose from, according to the latest data collected by Mozo.

After looking at 171 credit cards from 57 providers to reveal the cheapest low rate cards on the market, Mozo found there are only six cards charging ongoing interest rates below 10%.

“While it’s great to see a handful of low rate cards providing great value, it’s not enough to drive competition or provide enough choice for consumers,” said Mozo Director Kirsty Lamont.  

“The average credit card rate is 17.55% yet a huge 54% of cards have an interest rate over and above 18%”.

According to Mozo, the cheapest low rate credit card charges just 7.99% interest and costs $1,942 to maintain over five years. The average cost over five years is $4,273 while about a third of cards in the Mozo database cost more than $5,000 over that time. Mozo’s money experts found 10 low rate cards as offering great value but none of them are from a big bank.

“Credit Unions and Mutuals have really stepped up to the plate when it comes to low purchase rates and low annual fees, while the big banks don’t rate a mention,” said Lamont.

Mozo’s pick of Australia’s cheapest credit cards  

Card

Purchase rate

Annual fee

Stand-out features

Best Low Rate Credit Card

Quay Credit Union Visa Credit Card

7.99%

$36*

Lowest cost of over 5 years ($1,942)

Best Fee Free Card with lowest interest rate

ME frank Credit Card

9.99%

$0

55 interest free days

Best Platinum Credit Card with lowest interest rate

P&N Bank Platinum Visa Credit Card

11.49%

$80

Concierge, Travel Insurance, Extended Warranty, Purchase Protection benefits

Best Overseas Transaction Credit Card with lowest interest rate

Bankwest Zero Platinum MasterCard

17.99%

$0

0% foreign exchange margin, 55 interest free days

*Waived in first year

The above cards were recognised among others in Mozo’s Experts Choice Credit Card Awards but are singled out for having the lowest rate in their given category. Source: Mozo.com.au as at 14/9/15


The average Big 4 credit card interest rate is 18.98% with an average annual fee of $146, while Mutuals charge an average 13.92% and less than half the annual fee ($58).

“While premium and rewards credit cards have dominated the market in recent years, there is still a great need for low rate cards and we’d like to see a lot more of them,” said Lamont.

Top 5 Low Rate credit cards Versus the Big 4

Top 5 Low Rate Credit Cards

Ongoing Interest Rate

Annual Fee

Lowest rate cards from the Big 4

Ongoing Interest Rate

Annual Fee

1.

Quay Credit Union Visa Credit Card

7.99%

$36*

ANZ Low Rate Card

13.49%

$58

2.

Community First Credit Union

8.99%

$40

Westpac Low Rate Card

13.49%

$59

3.

ME frank Credit Card

9.99%

$0

Commonwealth Bank Low Rate Card

13.49%

$59

4.

GC Mutual Bank

9.99%

$50*

NAB Low Rate Card

13.99%

$59

5.

Maritime, Mining & Power Credit Union Visa Credit Card

10.12%

$60*

NA

NA

NA

*Waived in the first year. Source: Mozo.com.au as at 18/9/15

For a full list of Mozo’s Experts Choice Credit Card winners and award criteria, click here.

Credit card comparisons on Mozo - last updated February 27, 2021

Search promoted credit cards below or do a full Mozo database search. Advertiser disclosure.
  • Apply By May 31, 2021
    Bendigo Bank Low Rate Credit Card

    0% p.a. balance transfer for 18 months (Reverts to 11.99% p.a). Low annual fee of $45 and no fees for additional cardholders.

    Purchase rate
    Balance transfer rate
    Annual fee
    Rewards program
    11.99% p.a.
    0% p.a. for 18 months and then 11.99% p.a. (2.00% balance transfer fee)
    $45
    -
    Compare
    Details
  • Bankwest Zero Mastercard

    No annual fee and up to 55 days interest free on purchases. Get a notification before your minimum payment is due by setting up Easy Alerts in the Bankwest app.

    Purchase rate
    Balance transfer rate
    Annual fee
    Rewards program
    17.99% p.a.
    2.99% p.a. for 9 months and then 17.99% p.a.
    $0
    -
    Compare
    Details
  • Hot DealLimited time cashback offer
    Westpac Low Rate

    Enjoy 0% p.a. interest on balance transfers for the first 24 months. Get $200 cashback with $1k minimum spend on eligible purchases within 90 days of card approval. 55 interest free days and low on-going rate of 13.74% on all purchases.

    Purchase rate
    Balance transfer rate
    Annual fee
    Rewards program
    13.74% p.a.
    0% p.a. for 24 months and then 21.49% p.a. (1.00% balance transfer fee)
    $59
    -
    Compare
    Details
  • ME frank Credit Card

    Meet Frank, a low rate credit card with up to 55 interest free days and no annual fee. If simple, hassle free spending is your goal, you and Frank might be a match made in heaven.

    Purchase rate
    Balance transfer rate
    Annual fee
    Rewards program
    11.99% p.a.
    No current offer
    $0
    -
    Compare
    Details
  • Apply By February 28, 2021
    NAB Qantas Rewards Signature Card

    NABs fastest way to earn Qantas Points. 130,000 bonus Qantas Points when you spend $3,000 on everyday purchases within 60 days of account opening and keep the card open for 12 months. 7 complimentary insurances when you meet eligibility criteria including Overseas Travel Insurance.

    Purchase rate
    Balance transfer rate
    Annual fee
    Rewards program
    19.99% p.a.
    0% p.a. for 6 months and then 21.74% p.a. (2.00% balance transfer fee)
    $395 $295 in the first year
    Qantas Frequent Flyer
    Compare
    Details

^See information about the Mozo Experts Choice Credit Cards Awards

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