Credit card debt now stands at a record $52 billion, according to The Reserve Bank of Australia.
Usage is at an all-time high with 228 million purchase transactions attributed to plastic last December.
Visa is the dominant credit card brand with 61 per cent of consumers carrying one of its cards, according to emma. MasterCard has the loyalty of 48 per cent of the market, indicating of course that many consumers hold cards for both suppliers.
The third player, American Express, which has a different business model, can claim 17 per cent of the market, although much of this will be for corporate-card purchases.
A major driver in the growth in credit cards is the continued rise of internet shopping. Consumers who shop online each week are 38 per cent more likely to take out a credit card than the average Australian.
In their online retail sales report, the NAB estimates the domestic online retail market was worth $19.1bn last year – another all-time high.
Credit card security has become top-of-mind for most, according to emma. Of all shoppers who bought online in the past month, just 5 per cent said they were comfortable with the transaction process.
Some 3.3 million shoppers say they will only buy from well-known online stores, indicating security concern is doing little to diminish the demand for credit cards.
There are currently 16 million credit cards are in circulation. Some 600,000 consumers, 3.8 per cent of the current market, are planning on acquiring a new credit card in the coming months.
Demand is particularly high among Generation Y (24-35 yrs). They are 26 per cent more likely to sign up for a new credit card than the rest of the population.
Credit to newspapers
Data from emma indicates newspaper media advertising can help credit card companies recruit new customers and aid client communications, effectively reaching prospects with advertising.
Some 90 percent of prospects for a new card read newspaper media, 73 per cent reading print editions and 63 per cent reading digital formats, with 47 percent reading both.
Around 10 million credit card holders – 91 per cent of the market – have read newspaper media in the past month. They are 18 per cent more likely to be in the market for a new card than non-readers.
Readers are better educated and earn more than non-readers. They’re 44 per cent more likely to have tertiary qualifications than non-readers, and twice as likely to earn over $80,000 p.a.
Online advertising via publisher-owned digital platforms targets Gen Y consumers who love to keep up to date with the news. Some 68 per cent of them read news on a smartphone, tablet or computer.
The value of trust
Financial brands looking to attract customers can take advantage of the high level of trust that readers have in newspaper media to deliver financial information.
One in five consumers intending to open a new credit card account say newspaper media is their most trusted media for financial information.
Source: emma,12 months to December 2015. Survey conducted by Ipsos MediaCT, people 14+, Nielsen Online Ratings, December 2015, people 14+ only.