Personal loan statistics
Personal loan rates hit 11.05% in July 2024. The second highest since April 2024.
Key takeaways
- Average fixed personal loan interest rates hit 11.05% in July 2024, a recent high.
- Australians are increasingly taking out larger loans for vehicles and personal investments.
- Your credit score impacts your rate, with typical rates ranging from 6% to 20%.
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, the total value of personal loans now sits below pre-pandemic levels at $153 billion.
Aussies are, however, taking out larger personal loans every month, with a steady climb in the value of new funded fixed term loans since February 2021.
What are Aussies spending their personal loans on?
Car and other vehicle purchases is the top reason Aussies take out a personal loan, followed by personal investments like education. Australians took out around $1.5 billion in personal loans for purchasing cars, up 16% from the same time last year. The amount Australians took out for personal investment purposes grew by 20% over the same time period.
How much are Aussies paying for their personal loans?
Aussies are paying on average 11.05% for new fixed rate personal loans in July 2024. This is close to the peak of 11.09% recorded in April 2024.
Variable interest rates have remained more or less stable, with average rates at 8.52% in July 2024, peaking at 9.03% in January 2024.
Personal loans across Australia
According to Finder's Consumer Sentiment Tracker, as of July 2024, residents of NSW had on average the highest personal loan debt at $10,255. This is in contrast to Tasmanians who on average had the least at only $3,210.
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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!