Slow credit growth is the new normal and Australian lenders will need to adjust their profit expectations accordingly, according to a comparison website RateCity.
Some of Australia’s top-end credit card providers have been struggling with the slow credit growth, while borrowing for home loans has slowed dramatically over 2011, according to figures released by the Australian Bureau of Statistics.
RateCity chief executive Damian Smith said borrowing less money was "the new normal".
"Australians are saving at unprecedented rates with a record $535.6 billion of cash deposits sitting in banks and 10 per cent growth in the year to January 2012," Smith said.
"We really believe there has been a genuine shift in the way Australian consumers and businesses think about credit, and lenders will have to be prepared for a decade of slower credit growth," he said.
Year-on-year credit card growth for both total balances and balances accruing interest has hit a three-year low of about 2.5 per cent, according to figures released by the Reserve Bank of Australia.
"This is far from the credit card growth of 20 per cent for balances accruing interest in 2006," Smith said.
