Interest rates and informed choice in the Australian credit card market

16 December 2015

© Commonwealth of Australia 2015
ISBN 978-1-76010-340-8

View the report as a single document - (PDF 1151KB)

View the report as separate downloadable parts:

Senate Economics References Committee (PDF 0KB)
Chapter 1 - Introduction and overview of the Australian credit card market (PDF 0KB)

Conduct of inquiry
Background to inquiry
Structure of report

Chapter 2 - Overview of the Australian credit card market (PDF 0KB)

Use of credit cards in Australia
'Revolvers' and 'transactors'
Providers of credit cards
Credit card interest rates and spreads: variations and trends
Australian credit card interest rates: international comparisons
Responsible lending obligations for credit card providers
Understanding the impact of high credit card interest rates

Chapter 3 - Explaining the 'stickiness' of credit card interest rates (PDF 0KB)

'Up like a rocket, down like a feather': Credit cards and the RBA cash rate
The role of behavioural biases in informing credit card interest rates
Should credit card interest rates be regulated?
Card providers: headline rates are steady, but effective rates have fallen
Card providers: funding costs only one component of credit card costs
Profitability of credit card portfolios

Chapter 4 - Competition and consumer choice in the credit card market (PDF 0KB)

Competition and consumer choice in the credit card market
Breaking the 'confusopoly': empowering consumers to compare the market
Switching and closing credit cards
Peer-to-peer lending and differentiated interest rates

Chapter 5 - Helping Australians avoid the credit card debt trap (PDF 0KB)

Long-term credit card debt and responsible lending obligations
Minimum repayments and amortisation periods
Balance transfers
Financial literacy
Hardship supports for people struggling with credit card debt

Chapter 6 - Interchange fees, surcharges and competitive neutrality in the payments system (PDF 0KB)

Overview of interchange fees, merchant fees and surcharges
Designated and regulated payment systems
Payment systems reform in the early 2000s
Views on interchange fees
Views on surcharging
Financial System Inquiry and government response
Reserve Bank of Australia Review of Card Payments Regulation

Additional Comments by Coalition Senators (PDF 0KB)
Additional comments by Senator Nick Xenophon - Are the banks having a lend of us on credit cards? (PDF 0KB)
Appendix 1 - Submissions received (PDF 0KB)
Appendix 2 - Public hearings and witnesses (PDF 0KB)

Committee Secretariat contact:

Senate Standing Committees on Economics
PO Box 6100
Parliament House
Canberra ACT 2600

Phone: +61 2 6277 3540