Credit Card Interest Rates Australia Explained By Monzi

Credit card interest rates determine your costs of buying on credit. As a result, you’ll usually be looking for the lowest rates possible. That’s what Monzi’s here to explore. Through our guide to credit card interest rates, we’ll investigate how interest is applied, how you may find the lowest rate and anything else that you may need to consider. Let’s go.

Please note, certain ideas and products presented in this article may not be offered by Monzi nor the lenders we work with. This article presents only general information. Consider seeking professional financial, taxation, legal or other advice to check how the information and ideas presented on this website relate to your unique circumstances.

What are credit card interest rates?

If you borrow money in any way, you usually must repay it with interest. In short, this is simply the cost to access credit. Given this, if you have a credit card and intend to use it, then you must understand credit card interest rates.

As a rule, credit card interest rates will be expressed as an annual percentage (e.g. 20%). With this, credit card providers will apply interest to any debt that you have outstanding. As a result, if you do not pay your balance off in full, then you will have to pay some interest. Moreover, credit card interest rates are often high, meaning the costs can be considerable.

Satisfied that you know what credit card interest rates are? Great! We can now investigate how you may find the best credit card interests rates to help you reduce your costs. Moreover, we’ll look at the extra features and factors that are worth considering too. Let’s go.

How do credit card interest rates work?

As we’ve mentioned, your credit card interest rate will be listed as an annual percentage. However, when it comes to credit cards, interest is charged daily on any money that you owe. This applies to your outstanding balance if you fail to pay off your debt in full before the due date.

Given this, it’s best to try and reduce your debt whenever possible. If your credit card comes with an interest free period, then aim to pay off your outstanding balance each month. However, if you’ve accumulated some debt, then do what you can to pay it down whenever you have a little bit of extra cash. After all, as interest is applied daily, the costs will keep growing. As a result, small payments here or there could reduce your interest costs.

Compare credit card interest rates

Comparing credit cards is crucial. If you don’t look around, then how will you know what else is out there? While you may think that you’ve found a great rate, you could be missing a much better deal with a different provider.

Luckily, these days, comparing credit cards and interest rates is simple. While in the past you may have had to make a spreadsheet containing the details of different cards, comparison websites can now do that for you. In short, they will compile a list of options for you, allowing you to compare your options side-by-side. As a result, you can save much time and hassle when trying to find the best credit card interest rates.

What are the best credit card interest rates?

In Australia, credit card rates will usually range between 15% and 25% per annum. However, the exact rate will be determined by your provider, based on the type of card you apply for. Given this, it’s difficult for Monzi to say what the best rates may be.

In any case, to find the best credit card interest rates, you must shop around. As we’ve outlined above, by comparing your options, you can begin to form an idea of what a competitive rate may be. From there, you can narrow down your options to determine which card offers the best combination of favourable terms and best interest rates.

Who offers the cheapest credit card interest rates Australia?

Unfortunately, Monzi cannot say.

We cannot offer you credit cards, nor are we affiliated with any credit card providers. As a result, to find the cheapest credit card, it will be up to you. Do your research and compare options. Providers may vary in the rates and terms they offer, so do what you can to find the cheapest rates on a card that suits you.

Are all credit card interest rates the same?


Interest rates may vary between lenders and may be based on the type of card you apply for. As a result, there’s no one-size-fits-all. Instead, you must do your research and consider what you need in a credit card to determine which one may be right for you. From there, you can begin searching for the best credit card interest rates.

As a guide, types of credit cards include:

  • Introductory or standard credit cards
  • Student credit cards
  • Balance transfer credit cards
  • Credit cards with rewards programs
  • Travel credit cards
  • Premium or gold credit cards

Again, the rates on each card may vary. For example, the interest you pay on an introductory card may be much different from a premium card.

How do I choose the best credit card?

While it’s true that finding the best credit card interest rates is important, there are other factors to take into account too. By assessing every relevant aspect and comparing your options, you may find a card that is not only cost-effective but offers suitable terms or handy extras too.

Given this, to help you choose the best credit card, make sure you consider the following:

  • Additional fees and charges (e.g. establishment fees or annual account fees)
  • Interest free periods
  • Low rate or 0% interest introductory offers
  • Rewards programs and bonuses
  • The type of card (e.g. standard vs travel vs student)
  • Credit limits

For more details on choosing the best credit card, check out Moneysmart’s comprehensive guide today.

Why are credit card interest rates so high?

You may be looking at different credit cards and wondering why the interest rates are so high. After all, when you compare them to home loans or car loans, they are significantly greater. In short, it comes down to the fact that credit cards are a form of unsecured finance.

With this, if you have a credit card, then you are free to spend up to a pre-approved limit. However, you’re not spending your own money. Instead, you’re spending money that belongs to your credit card provider.

Obviously, though, you must repay any money that you spend. This is where the fact that it is unsecured matters. In short, with a car loan or home loan, the asset acts as security on the loan. In other words, if you default on the loan, then the lender can repossess the asset to recover their losses. With credit card debt, though, providers rely on you to repay what you owe. As a result, it’s much riskier and they apply higher rates to compensate for this.

How easy is it to get a credit card?

As with all credit products (e.g. cash loans and car loans), lenders won’t just approve your application as soon as you apply. Instead, they will take some time to assess your financial situation to determine if the product is right for you. That said, getting a credit card shouldn’t be too difficult for most Aussies.

Firstly, you must meet the eligibility requirements. With this, you must be over 18 and may need to be an Australian citizen or permanent resident. In addition to this, you will need to verify your identity by providing some key documents (e.g. birth certificate).

Next, providers may investigate your current financial situation (e.g. your income vs expenses). Moreover, in some cases, you may need to meet your provider’s minimum income requirements to be approved.

Finally, lenders may look at your credit history. With this, having bad credit may not be the end of the world. However, if you’ve been an unreliable borrower in the past, then you may be offered a lower credit limit than a good credit borrower. This may be similar to bad credit loans.

Given this, if you want to apply for a credit card, then it shouldn’t be too difficult. In some cases, you can apply online. However, if that’s not possible, then your banks may allow you to apply in person too.

What is a credit card balance transfer?

If you are currently dealing with credit card debt, then an option for you could be to complete a credit card balance transfer.

A credit card balance transfer involves transferring your existing credit card debt on one or multiple cards onto a new card. With this, the idea is to take advantage of low or 0% introductory interest rates that may be offered. That way, you can reduce your costs by eliminating additional interest expenses, making it easier to pay down your debt faster.

However, keep in mind that these introductory offers may only last for between six months and two years. As a result, you must do what you can to maximise the benefit while it lasts. Once the period elapses, the standard interest rate will apply. So, aim to repay your debt before you have to worry about interest again.

What’s an interest free period?

Credit card interest rates apply to the money you owe. However, when you make a new purchase, interest won’t necessarily be charged immediately. This is because credit cards come with an interest free period.

An interest free period lasts from the first day of your billing cycle until the day your bill is due. As a guide, this will usually be between 44 and 55 days. Within this period, if you make a new purchase, you won’t pay interest on it, as long as you pay your bill by the due date. If you fail to do so, then interest will be charged.

In any case, it’s important to note that not all purchases will come with the same number of interest free days. Instead, it depends on when in your billing cycle you made the purchase. For example, purchases at the beginning of the cycle give you more interest free days than purchases made at the end, given that the due date will be approaching.

To put it simply, interest free days are not applied to each purchase. They refer to the period of time between the beginning of your interest free period and your bill’s due date. Moreover, if you have an outstanding balance at the end of the month, then you may not be eligible for interest free days during the next statement cycle.

What interest free period should I select?

Most providers offer interest free periods ranging from 44 to 55 days. However, with some cards, you may be able to access interest free periods of up to 110 days. As a result, you’ll have to consider what works for you.

A longer interest free period will give you longer to pay off new purchases without incurring interest. However, lenders may charge higher annual fees on these cards compared to cards with shorter interest free periods. As a result, you’ll have to weigh up the costs and benefits to decide which is preferable.

Finally, as we’ve touched on, remember that interest free periods apply to new purchases. Moreover, not all purchases will have the same number of interest free days. Instead, it depends on when in your billing cycle you made the purchase. Items bought at the start of your statement period will come with more interest free days than an item bought two, three or four weeks later.

Credit card interest rate calculator

A credit card interest calculator, otherwise known as a credit card repayment calculator, can be a useful tool if you find yourself dealing with credit card debt.

In short, the calculator will ask you to input some key details. As a guide, this may include your interest rate, outstanding debt and minimum repayment. From there, it will produce estimates of how long it will take you to repay your debt by making the monthly minimum repayment. Moreover, you may have the option to see how making larger repayments would affect your timeline.

Given this, these calculators may help map out how long it may take to escape your current debt. That said, remember that online loan calculators and other similar tools only provide estimates. As a result, your actual timetable may vary.

How can I use a credit card effectively?

A credit card works in the same way as a debit card. However, instead of spending your own money, you’re borrowing money from your provider. When you need to make a purchase, simply swipe or tap your card and enter the pin. From there, the transaction should be processed.

However, you shouldn’t necessarily use your credit card for every transaction. Instead, you should aim to use it as a useful financial tool. In other words, it can be a great way to manage short term cash flow issues as long as you pay off your balance each month. That way, you can avoid any interest charges.

In addition to this, if you do have outstanding debt, aim to pay more than the minimum repayment amount. Typically, this will be 2% of your outstanding balance. However, you’re free to pay more. So, if you can afford it, aim to repay more of your debt so that you potentially be debt-free sooner.

Black wallet containing a card with the best credit card interest rates

Can I change my credit card limit?

Yes, potentially.

Your credit limit is essentially the level of debt that you can accrue on your credit card. For instance, it may be $500, $1,000 or even $10,000. If you try to spend beyond this, then transactions may be declined or your provider may charge a fee.

Lenders determine your credit limit when you apply for a card. With this, they will examine your current budget (e.g. income vs expenses), credit history and any assets or liabilities. The more secure your position, the higher your limit may be.

However, if you have been using your credit card for a while and feel that the limit is insufficient, then you can apply for an increase. To do this, approach your provider. As part of your application, you may need to supply similar details to when you applied. From there, they will assess your financial situation to determine if your limit should be raised. However, keep in mind that you are not guaranteed approval.

Finally, remember that while a higher limit may seem like a good idea, it may increase temptation and creates more opportunity for you to accumulate debt. As a result, you shouldn’t increase your credit limit unless it’s absolutely necessary.

What should I do if I’m struggling with credit card debt?

If you are struggling with credit card debt, then it’s important to not suffer in silence. There is help available and you should reach out at the first signs of trouble. Otherwise, problems can snowball.

If you find yourself unable to make your repayments or find that your credit card debt is out of control, then it may be wise to contact the National Debt Helpline on 1800 007 007. They may put you in touch with a financial counsellor who may offer free advice or help you develop a plan to manage the situation. Alternatively, a great place to start may be to read Moneysmart’s guide to getting your debt under control.

In addition to this, you could consider a debt consolidation loan for credit card debt. In short, this involves borrowing money to repay your current outstanding debts. As a result, you’re left with a fixed-term loan which may simplify your repayments. At Monzi, we work with lenders offering debt consolidation loans from $300 to $10,000. However, do not apply without considering the costs and consequences of this decision.

Are there any consequences if I don’t repay my credit card debt?


At the end of the day, if you spend money using a credit card, then you are obligated to repay it. However, if you don’t, then there will be consequences.

Firstly, your credit card provider may issue a default notice to you. This may occur if you missed a payment of more than $150 and your debt is more than 60 days overdue. A default notice is listed on your credit report and can make it more difficult for you to receive approval for instant cash loans or other credit products in the future.

Next, a debt collector may contact you. This will likely occur if you do not repay your debt after receiving a default notice. A debt collector may demand payment and make arrangements for this to happen.

Finally, your credit score may be hurt. Late or missed payments and defaults are listed on your credit report and may actively work to lower your score. As with a default notice, this may make it more difficult for you to access credit you need in the future.

Given this, don’t treat credit card spending lightly. You should only spend what you can afford to repay. Otherwise, you can find yourself in a world of trouble.

Can I cancel a credit card that I don’t use?


If you no longer need your credit card or want to eliminate the temptation to spend, then you can cancel your card. Luckily, it’s relatively easy to do. However, there are a few things that you must do before you cancel your card.

Firstly, ensure you pay off any money that you owe. If your balance isn’t $0, then you cannot cancel your card.

Next, you must cancel any direct debits linked to your card. In short, direct debits are on-going, automatic payments that are charged to your card. If you cancel your card without cancelling your direct debits, then you won’t be able to make your payments.

Once you’ve checked these boxes, log onto your account and follow the instructions to cancel your card. However, if you cannot do this, then you may also cancel over the phone or at a branch location. Contact your credit provider to determine your options. After it’s cancelled, cut up your card or shred it and then throw it away.

Are there any alternatives to applying for a credit card?


One alternative could be to apply for personal loans from $300 to $10,000. However, Monzi cannot say which option will be better. Instead, that will be determined by what you want and need.

On the one hand, personal loans are usually used to cover unexpected or emergency expenses that occur on an isolated-off basis. For instance, if a pipe bursts in your home and you must pay for emergency plumbing costs, then a personal loan could be an option. With this, you can borrow money today, which you then must repay via a series of repayment. Once you’ve paid off the balance of your loan, there’s no further commitment.

On the other hand, if you are approved for a credit card, then you will be free to use it up to a predetermined limit. With this, a credit card is often useful to help you manage cash flow issues. In other words, you can make a purchase before payday, then once you receive your income, you can pay off your outstanding balance before the due date. That way, you may not be charged interest.

So, while online personal loans could be an alternative to applying for a credit card, consider what you need and how you would use your card. From there, you can determine which option is best for you.

What’s the easiest way to get a personal loan?

We cannot say if it’s the easiest. However, a quick and straightforward way could be to apply with Monzi. In short, we’re a lender-finder. What’s that?

Well, think of us as a bridge. When you need quick cash but want to avoid the hassle for finding a lender, we’re there. Submit one application and we could match you with a lender in just 60 minutes. As a result, you can save time and effort.

At Monzi, we work with lenders who offer easy cash loans from $300 to $10,000 with repayment terms ranging from 12 to 24 months. Best of all, we’re 100% online, meaning you can apply anytime, anywhere. We’re always ready and waiting to receive your application.

Does that sound like the service for you? Apply today.

Are there interest rates higher on a credit card or personal loan?

Personal loan rates will not be the same as credit card rates. Moreover, as Monzi is not a lender, we cannot say what rate you may be offered. As a guide, it may vary based on the loan that you are offered. For instance, unsecured personal loans may come with higher rates than secured personal loans.

In any case, to give you an idea, you can visit our Costs page. With this, consider how much you would repay on top of what you borrow. Moreover, keep in mind that lenders may apply certain fees too.

Ultimately, personal loan rates may be higher. However, keep in mind that credit cards and personal loans serve different functions. On the one hand, a personal loan may be handy to cover a single, pressing expense that you can’t quite afford. On the other hand, credit cards may be useful to manage short term cash flow issues on an on-going basis.

How do I apply for a personal loan with Monzi?

It’s easy! All you need to do is follow these four steps:

  1. Choose your loan amount and repayment term using the loan slider.
  2. Complete and submit the online application form. With this, you must provide a handful of personal and financial details (e.g. name, date of birth, online bank details, etc.).
  3. We’ll take it from here. Once we receive your completed application, our automated system will try and match you with an available credit provider willing to consider your application.
  4. Check your texts and emails because we will contact you with an outcome. If we match you with a lender, then your application will be passed onto them and they will be in touch.

Keep in mind that Monzi cannot guarantee if your application will be approved. Moreover, if you are seeking quick loan approval, then ensure you apply during business hours. If you do, then Monzi may match you with a lender in just 60 minutes.

Get in touch

If you are weighing up your choices and decide that a personal loan is right for you, then Monzi’s lender-finder could make life a little easier. However, we understand that you may have questions. As a result, we’re always here to help.

If you have any questions, queries or concerns, you can contact our friendly customer service at Once we receive your correspondence, we’ll do our best to provide you with a quick response.

That said, keep in mind that we can only answer questions about our lender-finder service. In other words, if you want to learn more about credit card interest rates or the fast approval cash loans you may be eligible for, then you may need to contact a credit card provider or lender directly. Monzi cannot speak on behalf of other organisations, meaning we will be unable to help.

Credit card interest rates and Monzi

Credit cards and the associated interest rates can be a minefield. As a result, it’s always handy to understand what to look out for and what you need to consider. That’s why we’ve compiled this guide to credit card interest rates for you. Now, it’s up to you. Do your research and apply for the credit card that works best for your circumstances.

Fancy an online loan instead? Apply from $300 to $10,000 with Monzi. This may be a preferred option if you’re dealing with an isolated expense such as car repairs or a utility bill. Scroll up to Monzi’s loan slider or hit ‘Apply Now’ to get started today.

Finally, for all the latest from Monzi, check out our Facebook, Instagram, Twitter and Pinterest. Or learn more with our guide to virtual credit cards.

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You won't use a penny to apply for our lender-finding service, but here's some costs you could expect from a lender

Loan amount

$300 - $2,000


12 months (minimum)

12 months (maximum)


20% upfront establishment fee

+ 4% monthly fee


Loan Amount of $1,000 over 6 months repayable weekly (25 weekly repayments). $1,000 (Principal Amount) + $200 (20% Establishment Fee) + $240 (fees based on 4% per month over 25 weeks) = $1,440 total repayable in 25 weekly installments of $57.60.

Under the current legislation, most small personal loan providers don’t charge an annual interest rate (you’ll know this as an APR) %. The maximum you will be charged is a flat 20% Establishment Fee and a flat 4% Monthly Fee. The maximum comparison rate on loans between $300 and $2000 is 199.43%. The minimum and maximum loan term is 12 months. WARNING: This comparison rate is true only for the examples given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate.

Loan amount

$2,001 - $4,600


13 months (minimum)

24 months (maximum)


48% Annual Percentage Rate (APR)

67.41% Comparison Rate p.a.


Loan Amount of $3,000 over 18 months repayable weekly (78 weekly repayments). $3,000 (Principal Amount) + $400 (Establishment Fee) + $1,379.06 (reducing interest) = $4,779.06 total repayable over 18 months with weekly installments of $61.27.

The Annual Percentage Rate (APR) for Secured Medium Loans is 48%. The Typical Comparison Rate is 67.41% p.a. The minimum loan term is 13 months and the maximum loan term is 24 months. WARNING: This comparison rate is true only for the examples given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate with the lender that finances your loan. Click here to see a worked example.

Loan amount

$5,000 - $10,000


13 months (minimum)

24 months (maximum)


21.24% Annual Percentage Rate (APR)

48% Comparison Rate p.a.


Loan Amount of $10,000 over 24 months repayable weekly (104 weekly repayments). $10,000 (Principal Amount) + $5,577.12 (Interest) = $15,577.12 total repayable over 24 months with weekly installments of $149.78.

The Annual Percentage Rate (APR) for Secured Large Amount Loans is 48%. Maximum Comparison Rate is 48% p.a. The minimum loan term is 13 months and the maximum loan term is 24 months. WARNING: This comparison rate is true only for the examples given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate with the lender that finances your loan. Click here to see a worked example.