Credit products on the rise driven by demand for credit cards
If you’ve been feeling the weight of rising rates and a continually increasing cost of living, new statistics from Equifax show that you’re far from alone.
The Equifax Quarterly Consumer Credit Demand Index highlights a rising trend in almost all credit products. This means that since that September quarter 2021:
- Credit card applications have gone up by 31.5%
- Personal loan applications are up by 22%
- Buy Now Pay Later applications have increased by 9.9%.
The only credit applications that have fallen are for car loans (down 3.8% on this time last year), which can be in part attributed to the continued issues of car supply in Australia, and mortgage applications (down 6.8%), possibly linked to the recent downturn in the housing market.
A growing number of credit card applications are the driving force behind the overall trend upwards in demand for credit. This was especially true in the ACT, where credit card applications grew by over 40% from the same period in 2021.
A lot of this can be credited - sorry, sorry - to the changing perceptions and shifting face of the BNPL marketplace. Buy Now Pay Later is beginning to face regulation as a part of the credit landscape, while credit cards and personal loans feel tried and true to many borrowers.
Borrowers are gradually becoming more aware of changes to credit reporting, wherein BNPL debt can impact future borrowing power, in much the same way as credit cards and unsecured personal loans. It seems like we’re seeing this reflected in the figures, with credit cards surging back in popularity - and going into festive season, it seems like those cards are going to get used.
Added some new credit to your wallet in 2022? Check out our tips for busting debt before the new year. Find our top picks for credit products with Mozo’s best credit cards and best personal loans.