More credit card debt likely for 1 in 5 as Canadians focus on ‘surviving’
Global News
The survey from TransUnion also found about 26 per cent of Canadians said they expect to be unable to pay at least one bill or loan in full in 2025.
More than one in five Canadians expect to take on more debt in 2025, mostly via credit cards, according to a TransUnion consumer report that experts say shows many focus on “surviving.”
TransUnion’s fourth quarter Consumer Pulse study, released on Tuesday, surveyed 1,000 adults between Sept. 25 and Oct. 6 about their expectations for 2025.
That study found about 22 per cent of Canadians plan to take on more debt either by applying for new or refinancing existing credit in 2025.
According to TransUnion, the type of credit product most favoured is credit cards with 43 per cent of that one in five people planning to apply. The next type of loan activity is increasing available credit on a current card.
The expectation of taking on more debt comes even as the Bank of Canada continues to lower its key interest rate and inflation continues to cool.
But Matthew Fabian, TransUnion Canada’s director of financial services research and consulting, said though both are coming down there is a “lag effect” for Canadians to see the benefit due to the financial strains they faced previous years.
“Cost of living was up at the same time the cost of debt was higher, especially if you had something like a mortgage, and interest rates went up, all of a sudden it cost you more to carry that debt, and so that combination really stressed a lot of consumers wallets and created what we call this payment shock,” Fabian said.
About 44 per cent of households said their finances were worse than they planned for 2024 despite more than half saying their income remained the same for the previous three months, with no expectation it would change in the following year.
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