According to recent Equifax Canada data, Canadians are spending more on their credit cards. Our recent Market Pulse quarterly consumer credit trends show there has been a significant drop in new mortgages as Canadian consumers are leaning more on their credit cards. 

Over the last quarter not only is total consumer credit card spending up by 9.8 per cent (14.4 per cent when compared to Q4 2020), but the average monthly credit spend is also up. The average credit card consumer is now spending $2,205 per month, an increase of  15.2 per cent when compared to Q4 2020. 

Credit card spending is getting back to pre-pandemic levels

“The holiday period always leads to an increase in spending, but Q4 2021 saw higher than ever average credit card spending per credit card consumer,” said Rebecca Oakes, AVP of Advanced Analytics at Equifax Canada. “Consumer payment behaviour is slowly getting back to pre-pandemic levels as disposable income from government benefits depletes, but consumers are making less payment for every dollar spent compared to the same time period last year.”

Canadians are making less credit card payments per dollar spent

Consumers are paying $0.96 for every dollar spent, which is down by 2.9% when compared to Q4 2020. Higher spending is also reflected in overall credit card balances which was up by 2.4 per cent when compared to Q4 2020. New credit card demand is increasing again with new card growth finally reaching pre-pandemic levels. The average credit limit on new cards has increased by 23.2 per cent from Q4 2020 due to higher demand and lender confidence.

Delinquencies for credit cards increased

Although overall credit delinquencies remained low, there was a small increase in delinquency rates across certain products towards the end of 2021. The 90+ day delinquency rate for credit cards increased by 2.7 per cent when compared to Q3 2021. 

We want to help Canadians live their financial best. If you want to learn more about how understanding credit insights and mortgage trends can help minimize risk and increase growth in your business, please contact your Equifax Account Representative. You can also reach us directly at 1-855-233-9226 and follow us on Twitter and LinkedIn.  

Source: Quarterly Market Pulse Consumer Credit Trends

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