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Personal loan statistics
Personal loan rates hit 10.49% in February 2023. The highest since August 2019.
How much are Aussies taking out in personal loans?
Aussies have been taking out personal loans for decades – to spruce up their houses, to buy a car, to go on a well-deserved holiday. But how much are people borrowing exactly? And is it more expensive now than it was 15 years ago on average?
The total value of personal loans spiked to an all-time high in July of 2019 ($170.7 billion) with a change in the way data had been collected over this period by the RBA. Despite that total value of personal loan now sits below pre-pandemic levels at $142 billion.
Aussies are, however, taking out larger personal loans every month, with steady climb in the value of new funded fixed term loans since February 2021.
What are Aussies spending their personal loans on?
The purchase of a car or other vehicle is the top reason Aussies take out a personal loan, with Finder's Consumer Sentiment Tracker showing that 20% of personal loans are taken out for purchasing a new car. This is reflected in ABS data which shows the purchase of road vehicle remains the largest portion of the value of personal loans taken out each month.
However, Aussies are increasing taking out personal loans for personal investment like education, the purchase of household goods, and other miscellaneous purposes.
How much are Aussies paying for their personal loans?
Aussies are paying on average 10.49% for new fixed rate personal loans in February 2023. This is the highest since August 2019 after a steady climb since September 2021.
Variable interest rates have followed a similar path, with average rates now at 7.86%. This is the highest since July 2019.
Personal loans across Australia
According to Finder's Consumer Sentiment Tracker, Queenslanders had on average the most personal loan debt with $8,060. This is in contrast to Tasmanians who on average had the least at only $4027.
Over the same time frame, 9% Australians said they plan to take out a personal loan. Queensland leads the charge with 15% of residents having or planning to have a personal loan, followed by New South Wales at 14%. Tasmanians came in lowest on the list with only 8% having or considering a personal loan in the next 6 months.
Saranga Sudarshan was an insights analyst at Finder. He has a PhD from the University of St Andrews in political philosophy. Previously he was a research analyst at Frost & Sullivan. Saranga loves cricket, sports analytics and the way data can provide novel insights.
Hi,
Thank you for your article, it was really helpful and has valuable information. I would like to ask you a few things.
1) Why banks specified a range of the interest rates, and after you submit the answer to their questionnaire they give you a quote with an particular rate. Are the rates offered different from people to people? Does this depend on the risk profile of each applicant? What key information can help me to get the minimum rate available?
2) From your data, the minimum fixed rate shown is around 10%, over what period of time is this? Is it currently a good moment for request a loan due to the actual rate offered? Is it a 7.4% p.a. a good opportunity, for a $75k loan over 1 year payment?
3) If I would like to borrow money for investments on shares, is there any other options more convenient than a personal loan? If i do this through a company: (1) are there better deals available? (2) is the claim of all the debt for tax deduction better than doing it as company instead of as tax payer?
Thank you so mucho for your help.
Kind regards
The rates quoted on our pages are general p.a. (per annum), so it’s the rate that applies over 1 year. For example, a $10,000 loan with a 10% interest rate incurs interest of $1,000 over 12 months (usually divided into 12 monthly payments).
On top of this, fees and charges may apply.
The interest rate you’re eligible for can depend on a number of things including your income, disposable income and credit score.
Regarding your question about borrowing for shares: we can’t answer questions that constitute personal advice. However one thing to keep in mind is that the return you get from your share portfolio would need to exceed the interest rate you’re paying. This can be tricky to guarantee over the short term, when the share market can be volatile.
Overall, it might be worth meeting with a financial advisor to get some personal advice to help you work out the best way forward.
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Hi,
Thank you for your article, it was really helpful and has valuable information. I would like to ask you a few things.
1) Why banks specified a range of the interest rates, and after you submit the answer to their questionnaire they give you a quote with an particular rate. Are the rates offered different from people to people? Does this depend on the risk profile of each applicant? What key information can help me to get the minimum rate available?
2) From your data, the minimum fixed rate shown is around 10%, over what period of time is this? Is it currently a good moment for request a loan due to the actual rate offered? Is it a 7.4% p.a. a good opportunity, for a $75k loan over 1 year payment?
3) If I would like to borrow money for investments on shares, is there any other options more convenient than a personal loan? If i do this through a company: (1) are there better deals available? (2) is the claim of all the debt for tax deduction better than doing it as company instead of as tax payer?
Thank you so mucho for your help.
Kind regards
Hi Joaquin,
The rates quoted on our pages are general p.a. (per annum), so it’s the rate that applies over 1 year. For example, a $10,000 loan with a 10% interest rate incurs interest of $1,000 over 12 months (usually divided into 12 monthly payments).
On top of this, fees and charges may apply.
The interest rate you’re eligible for can depend on a number of things including your income, disposable income and credit score.
Regarding your question about borrowing for shares: we can’t answer questions that constitute personal advice. However one thing to keep in mind is that the return you get from your share portfolio would need to exceed the interest rate you’re paying. This can be tricky to guarantee over the short term, when the share market can be volatile.
Overall, it might be worth meeting with a financial advisor to get some personal advice to help you work out the best way forward.
Hope this helps!