Credit card debt rose $177 million in August: a warning ahead of Christmas spending
08 Oct 2025
Credit card debt climbed by $177 million in August as the relief from tax returns wore off and Australians found it harder to stay on top of their debt payments.
The total debt accruing interest on personal credit cards has reached $17.9 billion, according to today’s RBA credit card figures, in original terms.
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| Credit card debt attracting interest charges: personal cards | ||
|---|---|---|
| Amount | Monthly change | Year-on-year change |
| $17.9 billion | +$177 million
+1% |
+$348 million
+2% |
Source: RBA credit card statistics, August 2025, released 7 Oct 2025, original data terms, excludes commercial cards.
Australians’ spending season may have already begun
The total value of personal credit card transactions rose in August by $679.1 million (+2%), reaching the highest level recorded since reporting began in January 2002.
Spending on debit cards also rose in the month, with combined credit and debit card transactions rising by $1.1 billion (+1%).
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| Value of card transactions: RBA | |||
|---|---|---|---|
| Amount – August 2025 | Monthly change | Change from 1 yr ago | |
| Credit cards – personal cards | $29.3 billion
– record high |
+679 million
+2% |
+$1.6 billion
+6% |
| Debit cards | $54.6 billion | +$391 million
+1% |
+$3.3 billion
+6% |
| Total | $83.9 billion | +$1.1 billion
+1% |
+$4.9 billion
+6% |
Source: RBA credit card statistics, personal cards, August 2025, released 7 Oct 2025, seasonally adjusted data.
The warning ahead of the Christmas holiday period
Almost 29,000 new personal credit card accounts were opened in August, taking the number of accounts to 11.5 million, a level not seen since February of this year.
The RBA data also shows more than 2 million (18%) personal credit card accounts were inactive in August, meaning the account hadn’t had a single transaction recorded that month.
We’re urging Australians to check their card use. With many accounts sitting idle, many people could be paying unnecessary monthly or annual fees on cards they’re not using.
For the cards they are using, similar advice applies: make sure you have the right card for your spending intentions. Carrying revolving debt on a high-interest rate rewards card in the hope of earning points can backfire – the interest charges could easily outweigh the value of any rewards earned.
Canstar’s data insights director, Sally Tindall says, “Credit card debt has about-faced from July, when Australians managed to wipe off more than $274 million, to now see debt piling back on as the short-term relief from tax returns dries up.”
“With spending already hitting record highs in August, this could be an early sign of what’s to come as households head into the costly Christmas period.
“Now is the time for Australians to check their card. If you’re not using your card, consider closing it to avoid paying unnecessary fees.
“If you are regularly using it, make sure it’s the right card for you – particularly if you’re carrying debt month-to-month.
“Chasing rewards points while paying interest on sizeable debts at 20 per cent or more simply doesn’t add up.
“If you’re carrying credit card debt, make a plan to pay it off well before the silly season so you can enjoy your summer without a financial hangover.”
Tips to help clear credit card debt
- Pay more than the minimum repayment owed. Making only minimum repayments keeps you in debt longer and costs more in interest. Even an extra $100 to $200 a month can make a big difference.
- Use any windfalls wisely. Tax refunds, work bonuses, or other unexpected cash can go straight to paying down high-interest cards.
- Cut any unnecessary spending. Track your expenses and identify areas to reduce discretionary spending. The money you save can go directly onto your card balance.
- Consider a personal loan. If your credit card interest is high, a personal loan with a lower rate can potentially help you save on interest and force you to repay in regular installments, helping you steadily chip away at your debt.
- Automate payments. Set up automatic repayments to make sure you never miss a due date. Consistent payments help reduce interest and keep you on track.
This article was reviewed by our Finance Editor Jessica Pridmore before it was updated, as part of our fact-checking process.
