- CommBank has hiked interest rates on many credit card products
- The bank now offers the highest general credit card rates of the big four
- It will also increase international transaction fees charged to credit card customers on 1 December
As of today, CommBank has raised the interest rate on the majority of its credit card products to 20.99% p.a., marking an increase of as much as 1.25% p.a..
The bank is also increasing the international transaction fees it charges to credit card holders for Mastercard and Visa transactions from 3.0% to 3.5% as of 1 December.
The change comes ahead of what’s expected to be a cash rate hike at the Reserve Bank of Australia’s (RBA) November meeting next week.
|
CommBank credit card |
Previous rate |
New rate |
Difference |
|---|---|---|---|
|
Neo card |
0% |
0% |
- |
|
Low Rate |
13.99% |
13.99% |
- |
|
Low Fee |
19.74% |
20.99% |
1.25% |
|
Awards |
20.24% |
20.99% |
0.75% |
|
Smart Awards |
20.24% |
20.99% |
0.75% |
|
Ultimate Awards |
20.24% |
20.99% |
0.75% |
"We periodically review our card offering to maintain value and services," A Commonwealth Bank spokesperson told InfoChoice.
"We have a number of options for customers in relation to fees and interest."
For the most part, CommBank now offers the highest credit card interest rates out of the big four banks.
The majority of credit card offerings from Westpac and NAB boast interest rates of 19.99% p.a. at the time of writing, while those offered by ANZ are around 20.49%.
Aside from in cases of cash advances, a person holding a credit card won’t pay interest on their purchases as long as they repay their outstanding balance at the end of each period.
Additionally, CommBank’s newly increased international transaction fee charged to those making purchases in foreign currencies or while overseas won’t impact holders of all the bank’s credit cards.
Its Ultimate Awards, Smart Awards, Low Fee Gold (not available to new customers), and Neo cards don’t garner international transaction fees.
However, the 3.5% international transaction fee will soon be the highest out of those charged by the rest of the big four banks.
Westpac, NAB, and ANZ each charge a 3% international transaction fee on the majority of their credit card products.
The number of Australian consumers turning to credit cards has climbed amid the cost-of-living crisis, new data from Equifax reveals.
The credit reporting agency received 6.9% more credit card applications in the September quarter compared to the same period last year.
“Cost-of-living pressures are impacting household budgets, with consumers using unsecured credit to help them manage expenses,” said Kevin James, Equifax general manager of advisory and solutions.
“However, using unsecured credit to make ends meet is not a viable long-term strategy for consumers who are feeling financial strain and can create bad debt cycles if they can't keep up with repayments.”
Equifax also found credit card late delinquencies are at their highest level since 2021, with the number of accounts late by 90 days or more up 19% year-on-year.
CommBank’s credit card interest rate hike comes on the back of news the bank will be the first of the majors to offer zero-interest loans for the purchase of solar panel systems.
Select homeowners installing solar panels and batteries through provider UPowr can borrow up to $30,000 and pay it back in instalments over one to five years.
