The Consumer Credit Legal Center said banks, instead of garnishing paychecks and repossessing items bought on credit, are more likely to start bankruptcy proceedings, The Sydney Morning Herald reported.

"It scares the hell out of me," said Katherine Lane, a lawyer with the group. "If debt-collection practices become harsher, we're just going to see more desperate people."

Australians charged $20 billion ($17.5 billion U.S.) in December. The total owed on credit cards is expected to be $43 billion ($37.6 billion U.S.) by the end of the year.

Lane said debtors could be declared bankrupt and forced to sell their homes to cover their debts within three months of a creditor taking action, even when they are current on mortgage payments.