Personal loans becoming more popular than credit cards: CBA

30 October 2009

As the national economy begins to recover from the Global Financial Crisis and individual financing and budgets are becoming less of a stress for many people, there have been some new trends emerging when it comes to personal financing.

According to the Commonwealth Bank and The Australian, the number of personal loans that have been approved and are still awaiting approval has risen over recent months.

This trend matches the decline in the number of applications for other popular methods of financing, including credit cards, as it shows that Australians prefer the structure of a personal loan to the credit cards with interest rates meant to be one of the major deciding factors.

However, credit cards are still a highly popular financial resource for many people as are debit cards, which have recorded an impressive 13.8 per cent rise in the number of purchases made with debit cards for the month of August 2009 alone.

The preference for personal loans is not a trend that is supported industry-wide as other financial institutions report that credit cards, debt consolidation and redraw mortgage facilities levels are rising as a source of credit for their customers.

The choice between personal loans or credit cards for financing depends on the customer and the purpose of the financing. Generally speaking personal loans are taken out for a specific purpose such as a car or debt consolidation whereas credit cards are a great option as an emergency source of financing or continuous supply of funds.

The benefits of personal loans include the option of choice between various sizes and time durations along with a structured finance repayment system.

CreditCards.com.au is an Australian owned information provider on Australian credit card products. Please use our Compare the Top Ten Credit Cards table to find the right credit card for your financial needs.

We cover a wide range of credit card services provided by credit cards companies through the banking and financial sector.

Back to News Index | Back to Home