Want More?
This report is for members only.
Member-only content

Which credit card for you?

Financial institutions are using unfair practices to squeeze every last cent of interest from customers.
 
Learn more
 
 
 
 
 

01.Stings in the tail

credit_lead

Most CHOICE members pay their credit card bill on time and in full each month, avoiding interest and fees. From time to time, many of us slip up. Who hasn’t at one time forgotten to clear their bill by the due date, or misread a statement and paid the wrong amount?

It’s for these simple mistakes consumers with impeccable repayment records are being slugged with penalty interest. It’s not just a card’s interest rate that determines what you’ll pay; the amount you’re charged depends on when your card provider starts and stops charging interest and how fairly they apply interest-free periods. You could have two cards with exactly the same interest rate and use them in exactly the same way, yet one may end up charging twice as much interest as the other if you pay late. In fact, depending on your spending and repayment patterns, the difference could be much greater – as this report's case study explains.

CHOICE surveyed more than 20 credit card providers to find out how they apply interest when customers occasionally pay late or not in full. All the big guns provided information and calculations, as well as some smaller financial institutions. For those who always pay their bill on time, or for cardholders who are struggling with a recurring debt, see Picking the best card for our recommendations.

Credit card providers tested

  • Australian Central Credit Union
  • American Express
  • ANZ
  • Bank of Queensland
  • Bankwest
  • Bendigo Bank
  • Citibank
  • Commonwealth Bank
  • CUA
  • GE Money (Myer Visa and Low Rate MasterCard)
  • Heritage Building Society
  • HSBC Australia
  • IMB
  • Macquarie Bank
  • Members Equity
  • NAB
  • Savings & Loans Credit Union
  • St George Bank
  • Suncorp Metway
  • Teachers Credit Union
  • Westpac
CHOICE's experts independently test a wide range of products and services to bring you unbiased reviews, product comparison tools and buying advice that is trusted by 160,000+ members.
Get access to all
CHOICE benefits.
$7.98
/month
Subscribe to Choice
*Billed quarterly as $23.95
Want more?
Get access to our independent testing reports and save yourself time and money.
Subscribe to Choice
 
 

 

Sign up to our free
e-Newsletter

Receive FREE email updates of our latest tests, consumer news and CHOICE marketing promotions.

 
Your say - Choice voice

Make a Comment

Members – Sign in on the top right to contribute to comments