Is it time to switch to a low-fee credit card?
Despite the Reserve Bank cutting the cash rate to a record low of 2% in May, credit card interest rates have hardly moved, with the current average sitting at 19.75%.
The large gap was the focus of a senate estimates hearing earlier in the week, with the RBA promising to keep the issue on its agenda.
If you're a big spender (and you can manage to stay on top of your repayments), the major banks can give you back in extra features what you pay in fees. But if you frequently find yourself paying interest on top of your debts, switching to a low-interest and low-fee card will be better for your savings.
Michelle Hutchison, from finder.com, says that opting for a building society or credit union is a smart option if you're looking to save money on interest repayments.
"For cardholders who want a no-frills, cheap card, there are great value deals from smaller providers on the market," she says. "When it comes to credit cards, it's a good idea to compare the big banks with smaller providers as they are often more competitive on interest rates."
Cheapest low-fee credit cards from finder.com.au
1. Quay Credit Union Visa Credit Card - 7.99% 2. McGrath Pink Visa Credit Card - 8.99% 3. Community First Credit Union Low Rate Visa Credit Card - 8.99% 4. Bank MECU Low Rate Credit Card - 9.89% 5. Intech Credit Union Titanium 55 Credit Card - 9.99%