Credit cards at a 24-year high: what it means for your money

By Jack Ridder · 21 September 2026

In August, 71.1% of the value New Zealanders put on cards went on a credit card rather than a debit card. That is the highest share since Kiwibank's data series began in 2002, which is where the "24-year high" headlines come from. Debit cards took the other 28.9%. A decade ago, in the year to March 2017, credit cards were under half.

Kiwibank's economists described credit cards as increasingly the preferred way to pay for day-to-day spending. The NZ Herald reported the figures on 21 September 2026.

A big number that does not automatically mean trouble

Here is the part the headline skips. A high share of card value going on credit is not the same thing as a debt problem.

Plenty of people deliberately put every purchase on a rewards card, collect the points, and clear the balance in full before the due date. For them the interest rate is irrelevant, because they never pay any. That behaviour pushes the credit card share up without a cent of debt appearing anywhere.

The number that decides which group you are in is not in the news. It is on your statement: were you charged interest last month?

The figures that should worry you

The same Kiwibank research carries a second set of numbers, and these are the ones that matter:

• 40% of New Zealanders turned to debt to cover cost-of-living expenses.
• 19% used buy now, pay later as their main way of borrowing.
• 7% increased the limit on a credit card they already had.

Borrowing for something you chose is one situation. Borrowing to cover groceries, petrol and power is another, and lifting a limit to keep doing it is how a temporary squeeze turns into a permanent one.

What it actually costs here

New Zealand credit card interest, as at September 2026:

• Standard rewards cards: roughly 18.95% to 22.95% a year
• Low interest cards: roughly 9.95% to 13.90% a year
• Store cards: roughly 28.95% to 29.49% a year

Those ranges come from Consumer NZ and MoneyHub, both of which keep current comparison tables. Check your own card, because the gap between the cheapest and the dearest is more than 19 percentage points.

Two things about how that interest lands:

• It is charged daily. Interest accrues on the outstanding balance every day and is added at the end of the statement period, so paying a few days earlier genuinely costs less.
• Carrying a balance can cost you the interest-free period. On many cards, once you do not clear the full balance, new purchases start earning interest straight away until the whole lot is paid off. Check your card's terms, because this varies and it is the detail that surprises people most.

Paying the minimum is the trap

The minimum payment exists to keep the account in good standing, not to clear the debt. On a card charging around 20% a year, paying only the minimum on a few thousand dollars can stretch repayment out for years and add hundreds or thousands of dollars in interest. If you want the real number for your own balance, MoneyHub has a repayment calculator.

What to do this week

1. Find out if you were charged interest last month. Open your most recent statement and look for an interest line. If it is zero, the 71.1% headline is not about you. If it is not, everything below is.
2. Stop putting new spending on the card. You cannot pay down a balance you are still adding to. Move day-to-day spending back to a debit card while you clear it.
3. Pay more than the minimum, on a fixed schedule. Set an automatic payment for a set amount the day after payday, rather than paying whatever is left at the end of the month. There is rarely anything left at the end of the month.
4. Look at a cheaper rate. A low interest card or a balance transfer can cut the cost, but transfer rates revert to the standard rate when the promotional period ends, and new purchases on a transfer card are usually charged at the full rate from day one. Read the reversion terms before you move anything.
5. If this is cost of living rather than choices, get free help. MoneyTalks is free, confidential and independent: 0800 345 123, text 4029, or help@moneytalks.co.nz. Calling early is worth far more than calling once it is unmanageable.

The number that keeps the card in your pocket

Most credit card balances do not start with a big purchase. They start with a gap. Payday is Thursday, the power bill came out on Tuesday, and the card covers the difference. Then the next month starts a couple of hundred dollars behind, and the month after that starts behind the month before.

The way out of that pattern is knowing, before you spend, what is genuinely safe to spend. That is the one number KiwiBudget is built around: what is left until payday once the bills that have not come out yet are taken off. How the weekly number works.

More reading: how to build a budget that fits New Zealand life, and why winter costs catch people out.