Gillard: credit card policy

Prime Minister Julia Gillard said she would put the power to nominate a credit limit back in the hands of the consumer and stopping banks from automatically increasing credit limits.

Ms Gillard said many Australians had escalating credit card debt because every extension was accepted.

"One hundred and fifty thousand Australians get a new credit card every month, how amazing is that? Amazing," Ms Gillard said.

"So many Australians are reliant on credit cards, have credit cards, get new credit cards."

Under the policy the Labor Party will make it illegal for banks to offer regular credit limit increases unless consumers opt to receive it as a service.

Credit card statements will have to include a section on how long it will take to pay off the credit card if the holder only makes the minimum payment and how much interest would be paid over that time.

"It's truth, transparency but also more choice. So people aren't feeling that big credit card limits are forced on them," Ms Gillard said. "A lot of people have stories about being weighed under by credit card debt."

In June this year Australians held more than 13 million credit cards with a combined credit limit of about $122 billion, according to the Reserve Bank of Australia.

Ms Gillard said she would consult with financial institutions and consumer groups on the reforms.

She said giving people control and information over their credit card debt was important.

"So people couldn't get into escalating credit card debt because every extension has just been accepted," she said.

"We'd give people more ability to set their own credit card limits, so that there's a trigger point and they couldn't go over it."

The major banks' recent record super profits owe much to their gauging of credit card holders,  mortgagees and the $2.00 charge at ATMs if you happen to hold another banks' debit card.