More Aussies fall victim to credit card debt traps

Thursday 28 January 2010

Article by Mozo

High credit card spending at the end of last year has led to a 25 per cent increase in debt collection work.

Roger Mendelson, chief executive of debt collection firm Prushka, told the Courier-Mail about the rise in an interview. He said he had been surprised at the increase in overdue accounts referred to his firm.

"This, to me, is a sign that householders are struggling more than usual and businesses are taking a tougher line on householders carrying debt as they too struggle with cash-flow pressure," added Mr Mendelson.

Speaking to the Sydney Morning Herald last week, Harry Senlitonga, an analyst at the financial services firm Canstar Cannex, said that more Australians are now choosing to compare debit cards as they look to control their spending.

Recent Reserve Bank of Australia figures showed that consumers spent more than $20 billion on credit and charge cards in November, putting the average credit card account balance at $3,196.

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