Credit Checks Show Christmas Purchases Down
Sydney Morning Herald
Saturday January 6, 1990
Bank processing of credit-card vouchers from the Christmas period is confirming retailers' claims that it was not one of their best seasons.
Not only did customers keep their heads and not go over their credit limits, but the value of individual purchases appears to have been down on previous years.
According to several banks, final figures on the amount of goods bought on credit during the Christmas period, and whether there was an overall increase in the use of credit cards this year, will not be known for some time.
Indications from the Commonwealth Bank are that the average price of purchases this Christmas was down on the previous year. Even so, the volume of vouchers being handled by the bank is enormous.
During the two weeks before Christmas the bank had three shifts working around the clock to keep up with processing the credit vouchers.
Despite this, most banks contacted by the Herald claimed that it was a myth that the wide availability of credit encouraged people to go in way over their heads at Christmas.
"Most people use their cards wisely," said Mr Neil Magnay, of the Commonwealth, which issues Bankcards and Mastercards. "They'll use them up to the limit, but then they usually set about paying them back.
"Even at Christmas, people still spend only what they can, which is indicated by the amounts on the vouchers."
But he and other bank officials conceded that "there are always some who get into trouble".
"Most of them will not become apparent until February," Mr Magnay said. "But when they do they will need compassionate and understanding treatment. We would advise them to call us as soon as possible."
The National Finance Industry Association has launched a campaign to try to educate people about what to do if they get into trouble with repayments.
According to the NFIA'S Mr Chris Allen, most people handle their affairs well but it is still important to teach people about credit.
"We have to educate people into budgeting," he said. "They have to consider whether they can afford what they are buying."
He said that people who suspect they may have trouble should contact their creditors as soon as possible. He claimed that they were usually understanding.
"Most creditors are sympathetic, and are willing to find ways to work off the repayments," he said. "Repossession is a last resort."
According to the banks, the seasonal increase in the use of credit cards usually begins in late November or early December.
"The increase ... depends on a lot of different circumstances," said Mr Graham Owens, of the National Australia Bank.
"Judging by (our) workload, I'd say it began to increase in December this year."
© 1990 Sydney Morning Herald
Share This