Due to high inflation and rising borrowing costs, total Canadian consumer debt soared to $2.37 trillion in the fourth quarter of 2022, up 6.2%, according to financial analyst firm Equifax. Canada.
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During the fourth quarter of last year, the level of non-mortgage debt increased by 5.4% compared to the same period of 2021, a more marked increase which affects more people aged 27 to 42 with a above-average jump of 8.4%.
Even though mortgage debt accounts for three-quarters of all consumer debt, financial stress is most apparent among non-homeowners struggling with credit card debt.
In Quebec, the average indebtedness now stands at $18,495, the second lowest indebtedness in Canada behind Manitoba ($17,073), while the prize goes to Alberta with $24,724 for the period considered.
The last quarter of 2022 also saw a continued increase in the number of consumers actively using credit products (having opened at least one credit product), up 3.2%, according to Equifax Canada’s report.
“We’re starting to see an increase in missed payments on credit cards and auto loans, especially for low-income consumers,” said Rebecca Oakes, vice president of advanced analytics at Equifax Canada.
“Managing finances during a prolonged period of high inflation with a rising cost of living is unfortunately proving overkill for some people,” Ms. Oakes said, anticipating a payment shock for mortgages.
