Australians have been taking personal loans for decades on holidays, buy a car and houses. There had been a decline in the number of people taking a personal loan in the past four years but since July 2019 statistics show that approximately 168.2 billion dollars were given out as personal loans. The interest which is being charged on personal loans on average is 10.5% per annum which has seen most people taking the loans.
According to the Reserve Bank of Australia, most people are taking the loan and there is a dramatic increase of approximately $30 billion outstanding personal loans since last year. Here are some of the reasons why Aussies are taking personal loans in large numbers Whether it is for emergencies or the holidays.
-12% of the loan is mainly for unplanned purchases which include:-house emergencies, medical bills, car repairs, and maintenance.
-88%of personal loan is for planned purchases which include:- home renovation expenses, education costs, car loans, holidays and weddings.
This shows that personal loans have lots of impact among the Australian people and because it cuts across the better part of their lives to cover up for the expenses. It is interesting to know that statistics have shown that there is a drop in overall credit card debt which has led to an increase in personal debt consolidation loans. Many Australian’s are also turning to credit cards to manage their finances, cards like the NAB visa debit card are good to look into due to their benefits.
Additionally, the increasing numbers of people taking out personal loans have ditched out the big banks because people can access online lenders for a personal loan easily since they offer loans at a low interest.
Well, a personal loan is the easiest way of meeting up the expensive but it is also important to double-check the fees and payment flexibility which will not affect financial life. It is estimated that in the next six months approximately 23% of Australians will be having personal loans which are equivalent to 4.27 million people.