Consumer debt continues to grow, reaching a record $2.5 billion, credit bureaus say – Canada News

Consumer debt hit a record $2.5 trillion in the third quarter as many Canadians continue to struggle with the high cost of living and rising unemployment, according to new surveys by two consumer agencies. credit assessment.

The Equifax report indicates that newcomers and consumers who borrowed money for the first time in the past 12 to 36 months experienced the largest increase in missed payments, compared to the same group of consumers l ‘last year.

However, the pace of delinquencies has slowed following recent interest rate cuts.

Another credit reporting agency, TransUnion, says total consumer credit debt increased 4.1% in the third quarter year over year, as more consumers Generation Z have entered the credit market, making them the fastest growing segment to carry an outstanding balance.

Equifax adds that auto loans were a major driver of rising consumer debt, with non-bank auto loans up 12 percent and bank auto loans up 2.7 percent. year over year in the third quarter.

Equifax Canada’s Rebecca Oakes says small improvements in affordability in the auto market, such as moderating car prices and easing financing rates, are leading to increased demand for vehicle purchases.

TransUnion projects that auto loan amounts in 2025 will remain stable as lower interest rates offset high average vehicle costs, while overall delinquencies in the auto sector are expected to improve slightly next year.