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Marqeta Study: Credit Cards and Buy Now, Pay Later Services Rise in Popularity as Australian Consumers Face Dual Squeeze of Rising Interest and Inflation Rates

  • 52% of Australians surveyed were concerned about making credit card repayments given cost of living concerns.
  • 60% of Australians surveyed said they’d used credit cards to make ends meet in the last 12 months.
  • 67% of Australians surveyed in 2022 reported using a Buy Now, Pay Later (BNPL) service, up 12% from 2021.

MELBOURNE, Australia--(BUSINESS WIRE)--Actively rising inflation rates and continued consumer uncertainty are denting Australian consumer confidence and raising awareness of credit and BNPL options, according to a new survey published today from Marqeta (NASDAQ: MQ), the global modern card issuing platform. The company released its annual State of Credit report for 2022, which surveyed 4,000 consumers globally – including 1,000 in Australia – highlighting consumer sentiment around spending trends, alongside consumer credit experiences and preferences.

In Marqeta’s 2022 State of Credit report almost one-third (31%) of Australian consumers surveyed said that they struggled more with making credit card payments in the last 12 months. This was a sizable jump from 2021 when 25% of consumers surveyed said they struggled more, but considerably lower than the 44% of US respondents that said they’d struggled more in 2022. Seventy-three percent of consumers surveyed globally said they planned on reducing spending given cost of living concerns, and 52% of Australian consumers surveyed said that rising cost of living was causing them to be more concerned about making credit card repayments while 48% surveyed said the same about interest rate increases. Six-out-of-ten Australians surveyed said they’d used credit cards to help them make ends meet in the last 12 months, while 45% surveyed had turned to BNPL as a financial lifeline.

“Our new survey shows just how much uncertainty there is in the global economy, and Australian consumers have not been spared from the repercussions,” said Duncan Currie, Australian and New Zealand Country Manager for Marqeta. “Australian consumers are looking to their credit options for financial planning and peace of mind amid inflation and interest rate concerns. This is a time where we are really seeing modern and responsive credit options reflecting the realities facing today’s consumer.”

Showcasing the importance of credit cards becoming “top of wallet,” 87% of consumers surveyed globally said that they had one credit card they used more than any other. Australians surveyed were considerably more singular in their approach to credit, and were twice as likely as Americans surveyed to report only having one credit card (54% versus 27%). Roughly two-thirds of Australians surveyed (69%) said they were satisfied with their primary credit card, and more than half of Australians surveyed (54%) said they used their primary credit card for the majority of their total purchases. While demonstrating a surface level of stability and satisfaction, a significant portion of Australian consumers surveyed were looking at their credit options: 35% of consumers surveyed said they planned to apply for a credit card in the next 12 months, and 30% surveyed said they have stopped using a credit card in the last year. Younger consumers especially seemed to be having a more difficult experience with credit: 61% of Australian 18-25 year olds surveyed said they’d been turned down for credit, 6x higher than the number of 51-65 year olds surveyed (10%) who said the same.

Globally, adoption of BNPL services in Marqeta’s 2022 survey rose by a third, with 68% of respondents saying they’d used it to make a purchase, up from 51% of respondents in 2021. Reflecting previously higher adoption rates, BNPL use among Australian survey respondents rose more modestly, from 60% in 2021 to 67% in 2022. On the whole, Australian consumers largely reflected the continued global fascination and engagement with this rapidly growing new lending vertical.

  • Sixty-three percent of Australian BNPL customers surveyed said that they had increased their use of BNPL services in the last 12 months.
  • More than half (57%) of Australian consumers surveyed said they preferred using BNPL over their credit card.
  • Half (50%) of Australian survey respondents between 18-25 years old said they had used BNPL in the last month.
  • Almost half (49%) of all consumers surveyed globally said that interest rate increases were making lower-cost BNPL interest rates more attractive.

“Australian consumers may seem at a glance to be more settled in their credit choices, but a significant portion of them are looking at their options and on the hunt for the next new thing. With a large number of Australians also adopting BNPL, competition in the credit market in Australia is going to become increasingly fierce. The long term winners are likely to be those that invest in the best consumer experiences now, and down the road,” Currie said.

About The 2022 State of Credit Report

Marqeta’s 2022 State of Credit survey was fielded by Propeller Research on behalf of Marqeta, surveying 4,079 consumers between the ages of 18-65 (2,048 in the US, 1,025 in the UK and 1,006 in Australia).

To download the full report, please click here.

About Marqeta

Marqeta’s modern card issuing platform empowers its customers to create customized and innovative payment cards. Marqeta’s platform, powered by open APIs, gives its customers the ability to build more configurable and flexible payment experiences, accelerating product development and democratizing access to card issuing technology. Its modern architecture provides instant access to highly scalable, cloud-based payment infrastructure that enables customers to launch and manage their own card programs, issue cards and authorize and settle transactions. Marqeta is headquartered in Oakland, California and is enabled in 39 countries globally. For more information, visit www.marqeta.com, Twitter and LinkedIn.

Forward-Looking Statements

This press release contains "forward-looking statements" within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements expressed or implied in this press release include, but are not limited to, quotations and statements relating to changing consumer preferences; increasing consumer adoption of certain digital payment methods, products, and solutions; which payment, banking, and financial services products and solutions may succeed; technological and market trends; Marqeta’s business; and Marqeta’s products and services. Actual results may differ materially from the expectations contained in these statements due to risks and uncertainties, including, but not limited to, the following: any factors creating issues with changes in domestic business, market, financial, political and legal conditions; the effect of and uncertainties related to the global COVID-19 pandemic on U.S. and global economies and demand for Marqeta’s services and products; and the uncertainties and direct and indirect effects of the significant military action against Ukraine launched by Russia, including threats of attacks against U.S. financial institutions as retaliation against financial institutions for sanctions imposed against Russia. Detailed information about these risks and other factors that could potentially affect Marqeta’s business, financial condition and results of operations are included in the “Risk Factors” disclosed in Marqeta's Annual Report on Form 10-K for the year ended December 31, 2021, as such risk factors may be updated from time to time in Marqeta’s periodic filings with the SEC, available at www.sec.gov and Marqeta’s website at http://investors.marqeta.com. The forward-looking statements in this press release are based on information available to Marqeta as of the date hereof. Marqeta disclaims any obligation to update any forward-looking statements, except as required by law.

Contacts

Media:

James Robinson

530-913-0844

[email protected]

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