AUSTRALIANS will 'gift' an estimated $10.7 million to their credit card providers in the form of extra interest revenue in January, new research from Australia’s leading financial comparison website, RateCity (www.ratecity.com.au) has found.

Credit card users owe a massive $48.8 billion on their cards, with more than $34.2 billion accruing interest, latest Reserve Bank figures show.

And RateCity estimates that plastic debts will balloon by 2 percent in January as the nation deals with Christmas spending hangovers.

Alex Parsons, CEO of RateCity.com.au, said the simple fact is we spend a lot more over the Christmas season on our credit cards than in other months.

“On average, January is the month where Aussies stack on the most credit card debt and it’s a good bet they’ll be higher again in January 2014 – for a start, there are over 200,000 more credit cards on issue than there were last Christmas,” he said.

Historical data shows January is the month when Aussies have the most debt on their credit cards at 2.21 percent extra debt compared with December, on average over the past decade.

And this coming January is unlikely to be an exception, despite Australians scaling back on their spending in the past few years.

RateCity’s analysis has found the average credit card interest rate is around 17 percent, which means that nearly $11 million of extra interest will be paid from cardholders in the New Year because of festive spending.

“Some Christmas spending might feel OK when you put it on plastic, but it’s just as much of a debt as borrowing for a house or a car, and a lot more expensive in terms of interest rate,” added Parsons.

“Credit cards are generally a pretty good instrument if you pay them off every month, but, if you don’t, they are probably the worst form of credit you can have in terms of average interest rates that are attached to them.

“Interest rates on credit cards remain very high at around 17 percent on average, and range up to 22.99 percent, so consumers who carry debt should look at switching to get a better deal.”

RateCity currently lists several credit cards with an introductory rate of 0 percent for up to 12 months, and ongoing rates from 8.99 percent.

• RateCity estimates that plastic debts will balloon by 2 percent in January as the nation deals with Christmas spending hangovers

• Credit card rates remain high at 17 percent on average, and up to 22.99 percent. Yet, several 0 percent cards are currently on offer for up to 12 months – consumers are urged to look around for a better deal

• The real number that matters with cards is not the initial spend, rather the balance accruing interest and currently Aussies have $34.2 billion accruing interest!

www.ratecity.com.au

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THE Council of Small Business Australia (COSBOA) annual general meeting held today delivered changes of the guard with Institute of Public Accountants (IPA) chief executive officer, Andrew Conway taking the role of chairman.

COSBOA Council members wholeheartedly endorsed the focus of COSBOA on the fact that small business are people first and deserve the same rights and treatment as other people in the community,” said Mr Conway.

“There is no doubt a natural fit with my role at the IPA as we are fully focused on this most critical contributor to the Australian economy; the small business sector.

“Many of our members are either small business people or they are practices serving the small business community.

“I am very fortunate to take up the new challenge on the base of good work of Amanda Lynch who has been an excellent chairperson over the past year.

“I am looking forward to the year ahead to drive key initiatives that support the small business community and to work on building a more credible voice for small business,” said Mr Conway.

www.cosboa.org.au

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Peak retail industry body the Australian Retailers Association (ARA) said today after a year of implementation the plain packaging experiment is not working and has had no impact on legal tobacco volumes.

ARA Executive Director Russell Zimmerman said the change to plain packaging has been a waste of retailers’ time and resources.

"The ARA has long argued these changes were an unnecessary burden for small to medium retailers, and it is now evident that this initiative has had absolutely no effect.

"We are also very aware of reports from retailers that illegal tobacco products are swamping the market, and this has only been made worse by plain packaging which has seen product move out of well regulated legal distribution through retailers.

“Since plain packaging was introduced on 1 December last year, legal cigarette sales overall have remained very stable while illegal sales have increased, suggesting people are smoking more and paying less. The cheap price segment which represents the lower end of the legal market has actually grown by 33 percent since plain packaging was introduced, according to industry today.

“The ARA will be making the point to the government the effects of further excise and price hikes will only exacerbate the illegal tobacco trade,” Mr Zimmerman said.  

Since 1903, the Australian Retailers Association (ARA) has been the peak industry body representing Australia’s $258 billion retail sector, which employs over 1.2 million people. The ARA ensures retail success by informing, protecting, advocating, educating and saving money for its 5,000 independent and national retail members throughout Australia.

Visit http://www.retail.org.au/ or call 1300 368 041

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Peak retail industry body the Australian Retailers Association (ARA) said online retailers were looking forward to Sunday December 8 – the day eBay and PayPal have announced as the biggest mobile shopping day ever, with more mobile purchases predicted from Australian websites on this day than ever before.

ARA Executive Director Russell Zimmerman said approximately 2.3 million Australians will visit eBay on this day alone of which a record 1.28 million will come via a mobile device – 30 percent more than the busiest online shopping day in 2012 (December 9).

“Online retailers are in for a busy few weeks, with a record 140,000 items forecast to be sold and $5 million worth of goods traded via a mobile on this day – 40 percent more than in 2012.

“Shoppers will 'click into Christmas' more than ever this year, and the ARA has been working alongside retailers to ensure their websites are as user friendly as possible in the lead up to Christmas.

“eBay predicts that on December 8, a piece of women’s clothing will sell every eight seconds and a piece of fashion jewellery will sell every 20 seconds via a mobile device. An average of more than 200 items will be sold on eBay.com.au every minute –a marked increase from last year,” Mr Zimmerman said.

Nicolette Maury, Buyer Experience Director, eBay Australia, said Australians are leaders when it comes to mobile adoption.

“In 2012, Australians who shopped online via a connected device were the minority but this Christmas more Australians will visit eBay via a mobile device than their fellow desktop shoppers.

“It’s become really clear this year that Australia is a nation of multi-taskers, using connected devices to multi-screen from the couch or to search for Christmas gifts on the way in to work. And it’s not just stocking fillers or last minute gifts that shoppers are heading online for this Sunday. 1800 fitness items and 1600 pieces of furniture will be purchased via a mobile device which means that consumers don’t think twice about purchasing large ticket items online anymore,” Ms Maury said.

Jeff Clementz, MD, PayPal Australia said the mobile trend is not isolated to eBay.

PalPal are also expecting to see one in three transactions during the peak Christmas buying period to occur via mobile, up from one in five last year.

“With more Australians shopping via a connected device, PayPal expects mobile shopping purchases to increase more than 60 per cent this year compared to last year as Australians tap into the trend of buying on the go,” Mr Clementz said.

“Overall, shoppers are expected to put $42.2 billion through retail tills from 14 November until 25 December, representing a 3.5 percent gain on sales during the same period in 2012 ($40.7 billion),” Mr Zimmerman said.

On Sunday December 8, 2013 on eBay.com.au:

- 390,000 items will be to be sold on eBay.com.au on December 8 (17 percent more than the busiest online shopping day in 2012)

- $14.6 million worth of goods will be traded on this day

- An average of more than 200 items sold on eBay.com.au every minute

- A piece of women’s clothing will be sold every 4 seconds

- A DVD will be sold every 6 seconds

- A piece of fashion jewellery will be sold every 8 seconds

- A piece of men’s clothing will be sold every 12 seconds

- A home decoration will be sold every 16 seconds

- A piece of furniture will be sold 24 seconds

- A radio controlled toy will be sold every 29 seconds

- A watch will be sold every 35 seconds

- A pair of women’s shoes will be sold every 36 seconds.

Since 1903, the Australian Retailers Association (ARA) has been the peak industry body representing Australia’s $258 billion retail sector, which employs over 1.2 million people. The ARA ensures retail success by informing, protecting, advocating, educating and saving money for its 5,000 independent and national retail members throughout Australia.

Visit www.retail.org.au or call 1300 368 041. 

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