Commonwealth Bank 'offers $1 credit card'

Commonwealth Bank is offering an ultra-low rate credit card, it has emerged.

Financial giant Commonwealth Bank is reportedly offering cut-price credit cards in a bid to persuade consumers back into the retail sector, amid concerns over weak confidence and sluggish spending.

According to the Daily Telegraph, Commonwealth's $1 Low Rate credit card also comes with $100 up front as an additional sweetener, although interest rates are set at 13.49 per cent with annual fees of around $78.

"They still have to satisfy the bank's stringent assessment policy ... so we're certainly not handing out cards without any regard for customers' ability to service the balance," a spokesman for the bank told the newspaper.

However, consumer groups expressed concern about the offer and Choice representative Ingrid Just observed that it could tempt shoppers to sign on the dotted line without giving consideration to its later implications.

Last month, Australian Bankers' Association chief executive Steven Munchenberg told a parliamentary economics committee that there had not been an "outbreak of credit card debt".

By Kate Guthrie