One in ten adult Australians lie about their financial circumstances when applying for credit, according to new research conducted by Galaxy Research for credit bureau Veda Advantage. The survey found that 1.8 million Australians chose to misrepresent their circumstances, which amounts to about 200,000 more than six months ago. 1.1 million Australians purposefully understated their total expenses, while 430,000 understated the total amount of money currently owed on credit cards. 330,000 on the other hand chose to overstate their income.
The survey also found that one in five Australians admitted that it was difficult to repay debt. 28% of those who are already struggling with debt said that they are likely to apply for more credit in the next six months, and 14% said that they had already missed a minimum bill repayment.
Head of consumer risk at Veda Advantage, Angus Luffman, said that the findings were quite troubling considering the continuing financial vulnerability of many Australian. Australia’s credit system has been lagging behind international standards and currently lenders can only look at very limited information when considering whether to approve a card, “They cannot see whether a consumer is financially overcommitted and whether they can meet their current repayment obligations.”
It is unclear at this time whether changes will be made in order to ensure that Australians do not lie on their applications.
As always, stay tuned to Credit Cards Professor for more credit card news and updates.
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