Reliance on credit cards grows: StatsCan

As financial conditions tighten, mortgage debt growth eased to its slowest pace in two years in October, and households’ credit card debt continued to rise, according to new data from Statistics Canada.

Total household borrowing grew by 0.4% in October, rising by $9.8 billion to $2.8 trillion.

Mortgage debt accounted for $7.7 billion of the monthly increase, which StatsCan said was the smallest month-over-month increase since June 2020.

As borrowing costs continued to rise, October marked the fifth straight month of “slowed growth” in mortgage debt, the national statistical agency noted.

Debt backed by real estate, comprised of both mortgages and home equity lines of credit, rose by 0.3% in the month.

At the same time, households’ reliance on credit cards continued to increase in October, StatsCan said. Credit card balances rose by $1.5 billion in October, accounting for more than two-thirds of the $2.2 billion increase in non-mortgage debt.

Compared with the same month last year, credit card debt held by the chartered banks was up by 14.7%, StatsCan said.

Alongside the growth in household debt, the agency also noted that borrowing by private non-financial corporations continued to increase in October, led by a 1.6% increase in non-mortgage loans from chartered banks.

Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.