Canadian credit card debt soared in the last three months of 2022 amid rising interest rates and stubbornly high inflation with younger Canadians in particular relying on credit to make ends meet.
Credit monitoring agency Equifax says Canadians’ credit card debt increased by more than 15 per cent from the same period a year earlier and totalled more than $100 billion for the first time.
In its latest quarterly credit trends report, the agency says overall consumer debt rose in the fourth quarter of 2022, with total debt at $2.37 trillion, up more than six per cent from the same period in 2021.
Equifax says the effects of higher interest rates are yet to be fully felt on homeowners as many have not yet renewed their mortgages, but younger Canadians are feeling the pinch of inflation particularly hard.
Non-mortgage debt levels were up 5.4 per cent in the fourth quarter, but for millennials that debt rose by 8.4 per cent.
Consumers without mortgages saw the greatest jump in missed debt payments in the fourth quarter, and the delinquency rate among those aged 18 to 25 rose almost 31 per cent year over year, compared with a 17 per cent increase across all consumers.