In a now well-established trend, Australians are reducing the amount of debt they carry on credit and charge cards.

According to figures recently released by the Reserve Bank of Australia, the total outstanding balance of purchases and cash advances on all credit and charge cards decreased by 1.6%, from $46.9 billion in December to $46.2 billion in January. This is an increase of 5.0% over January 2009, a substantial slowing of the 11.0% trend consumers developed over the previous five years.

The average outstanding balance, including cash advances, decreased by 1.9%, from $3,250 in December to $3,188 in January. This figure rose by 2.9% since January 2009, another hefty decline from the five-year trend of 5.5%.

Australians also whipped out their plastic less often, in a typical January cool-down from the holiday whirl. The sum charged to all credit and charge cards, including cash advances, decreased a whopping 22%, from $22.0 billion in December to $17.2 billion in January. This figure is 4.4% higher than January 2009.

Counting only purchases, charge and credit card holders spent $16.3 billion in January, a 22.5% decrease from December’s $ 21.1 billion. That’s still 4.4% higher than figures from January 2009.

Charge and credit card cash advances also continue to decline. Cash advances in January totalled $855 million in January and $948 million in December, a decrease of 9.8%. That’s a 12.8% decrease from January 2009.

Purchases and cash backs through EFTPOS also declined. By value, January’s $11.4 billion was a 19% decrease from December’s $14.1 billion. The January figure is 9.3% higher than January 2009, down from the five-year average of 12.5%.

Repayments to charge and credit card balances were not robust, decreasing 13.6% from December’s $21.5 billion to January’s $18.6 billion. That is 2.8% higher than January 2009, a substantial decrease from the five-year average of 8.9%.

The RBA figures have not been seasonally adjusted.

Source: http://news.smh.com.au