Canadian credit card debt is skyrocketing
Total Canadian credit card balances top $100 billion for the first time.
Canadian credit card debt soared in the last three months of 2022 amid rising interest rates and high inflation. Younger Canadians in particular have been observed to rely on credit to make ends meet.
Credit monitoring agency Equifax finds that Canadians'debt on their credit cards credit grew more than 15% from the same period a year earlier and totaled more than $100 billion for the first time.
In its latest quarterly Credit Trends Report, the agency says overall consumer debt increased in the fourth quarter of 2022 to total debt of approximately $2.37 trillion, up more than by 6% compared to the same period in 2021.
According to Equifax, the effects of the rise in interest rates are not yet fully felt by owners, because many have yet to renew their mortgages, but young Canadians are particularly hard hit by inflation.
Inflation levels x27;non-mortgage debt rose 5.4% in the fourth quarter, but for millennials, that debt rose 8.4%.
Consumers without mortgages experienced the largest increase in debt defaults in Q4, particularly 18-25 year olds who were almost 31% outnumbered year to miss a refund, compared to a 17% increase for all consumers.