As things get more expensive, more lower-income Canadians are using their credit cards to cover their bills.
A report from the credit rating agency Equifax last week said consumer debt on credit cards hit a new record at the end of the second quarter of the year in June.
Part of that story is largely unseen – it is another of the by-products of our population growing. There are more people in the country and that means more folks with a credit card which translates into higher volumes of transactions on them.
But they also note that those with stronger incomes are able to make adjustments to their spending habits in the face of higher inflation and rising costs. They are, in fact, cutting back on their credit card use.
Those at the lower end of the income scale have more trouble cutting their spending. So, they are relying on credit cards to cover day-to-day expenses.
They report the average balance or amount of what they call non-mortgage debt was more than $21,000 back at the start of the summer.