Consumer vulnerability – insights and regulatory approaches
ACCC/AER Regulatory Conference
Consumers and COVID-19 Trends
Growing proportion of vulnerable groups take out high-risk-high-cost payday loans or consumer leases
(Question: In the past month, have you taken any of the following actions to manage your household expenses? E.g. payday loans/consumer leases)
Summary of results
- Slight trend growth in the proportion of Australian consumers taking out high-cost-high-risk payday loans/consumer leases from May – December
Among consumer subgroups, the trend has been much sharper – peaking in November:
- 9% of young people (18-34) – extrapolated this equates to more than half a million young people (535k)
- 7% of consumers living with disability
- 7% of renters
- 8% of CALD consumers (not shown)
- 3% of the Australian population
Growing proportion of vulnerable groups relying on credit/BNPL
(Question: In the past month, have you taken any of the following actions to manage your household expenses?)
Summary of results
- Slight trend growth in the proportion of Australian consumers relying on credit or BNPL for household expenses from May – December
- Among consumer subgroups like renters, the trend has been much sharper, peaking in September: 37% of renters – compared with 26% of the Australian population
Consumers missing household bill payments on the rise
(Question: Thinking of your (household bills), have you attempted any of the following in the last 4 weeks?)
Summary of results
Renters in particular struggled to make payments – trending up from 4% in May across the period peaking at 10% in Nov. Among renters:
- 22% of CALD community missed rental payment in November
- 17% of young people missed rental payment in November
Missed credit card, loan or BNPL repayments also steadily increased across the period. Again, a higher proportion of particular subgroups reported missing a credit payment:
- 12% of young people in both Nov and Dec
- 11% of renters in both Nov and Dec
- 10% of CALD consumers in Nov and 11% in Dec
Regulatory Approaches to consumer vulnerability
Key measures underpinning vulnerability strategies
(Exploring regulatory to vulnerability – A report for the Australian Energy Regulator 2020)
For more information…
KEY REPORTS
Exploring regulatory approaches to vulnerability: A report for the Australian Energy Regulator
The experiences of older consumers: Towards markets that work for people