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Credit card debt sets all time record.



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Media Release by…

ALAN GRIFFIN MP Shadow Parliamentary Secretary for Consumer Affairs & Banking Services

30 April 2002

CREDIT CARD DEBT SETS ALL TIME RECORD

Urgent reforms are needed to the Uniform Consumer Credit Code (UCCC) following the release of alarming new figures on soaring credit card debt, Shadow Parliamentary Secretary for Consumer Affairs and Banking Services.

Figures released by the Reserve Bank of Australia for February, have shown credit card debt to be at an all time high, moving to nearly $20.5 billion. On average, each credit card holder is $2120 in the red, up 12% from last year.

This record amount of debt demonstrates that credit spending in Australia is getting out of hand. It is clear that the Government must act quickly to put the brakes on credit card debt.

In the interest of all Australians, Labor believes it is essential that the Government in co-operation with the states, reforms the current UCCC to curb the rocketing debt problem.

Labor believes that the UCCC must be changed to require that a credit card provider can only increase a credit card limit if the cardholder has made a request. In just over a year, credit card limits on average increased by over $1000 to $6213.

Labor believes the UCCC should require credit card statements to include a warning about how long it will take to repay debt at the minimum level of repayment and prohibit unsolicited promotional material with pre-approved credit limits.

Credit card debt is a serious problem in Australia. We must see the Government act to ensure that credit card debt does not continue out of control.

For further information please contact: Alan Griffin: 0419 353 476