Latest news with #CIIR
The Hindu
3 days ago
- Business
- The Hindu
Innovation key to self-reliant India: Governor Thaawarchand Gehlot
Governor Thaawarchand Gehlot, speaking at the launch of the national campaign Innovasthan – a Vichar to Vikas Yatra in Bengaluru, on Saturday, emphasised innovation as the cornerstone for building a self-reliant India and achieving global leadership. Organised by the Council for Industrial and Innovation Research (CIIR) and Jain (Deemed-to-be University), the event highlighted India's rise in the Global Innovation Index—from 81st in 2015 to 40th in 2023. Mr. Gehlot praised initiatives such as 'Make in India' and 'Aatmanirbhar Bharat' and stressed the importance of intellectual property (IP) management. Karnataka's 6,500+ patent filings in 2022–23 were cited as a model, with a call for educational institutions and MSMEs to prioritise IP. He urged that innovation must permeate education, policy, industry, and society, making it a national priority for sustainable development.
Hamilton Spectator
28-05-2025
- Business
- Hamilton Spectator
Canadian Credit Market Reaches $2.5 Trillion in Outstanding Balances, with Gen Z Canadians Accounting for 10% of Credit Growth
Key findings from TransUnion report: TORONTO, May 28, 2025 (GLOBE NEWSWIRE) -- The first quarter of 2025 saw mixed outcomes in the Canadian credit market, according to TransUnion's Q1 2025 Credit Industry Insights Report (CIIR) . Growth was fuelled by increased borrowing from young Canadians and newcomers. Consumer balances for non-mortgage products rose across most products, driven primarily by below prime consumers. Subprime consumers continued to struggle as their delinquency rates rose at significantly higher rates than prime and above consumers. Regional differences in cost of living and economic conditions also led to varying delinquency trends across provinces. Gen Z Consumers Accelerated Overall Credit Participation with 30.6% Year-Over-Year Growth in New Balances After the decline in interest rates and inflation in late 2024, Canadians' total outstanding balances across all credit products grew by 4.7% year-over-year (YoY) and total outstanding credit debt reached $2.5 trillion in Q1 2025. Continued credit expansion, propelled by younger consumers, including new Canadians entering the credit market, was a key driver of this growth. As Gen Z consumers continued to participate in the credit market, outstanding balances within this generation have grown 30.6% from the prior year, contributing $12 billion or 10.3% of total new balance growth. Canadian newcomers also represent a significant portion of the growing credit market, driving $2.6 billion in new credit balances, a 6.3% increase YoY. 'As a growing share of Gen Z consumers actively engage with credit, lenders face a pivotal opportunity to shape lifelong financial relationships,' said Matt Fabian, director of financial services research and consulting at TransUnion Canada. 'This generation values digital-first experiences, personalized education and brands that align with their values. Prioritizing credit education, fostering early loyalty and offering seamless, mobile-friendly solutions will be key to staying relevant and building trust with these new-to-market borrowers.' Non-Mortgage Balances Continue to Grow, Driven by Below Prime Consumers Non-mortgage debt grew 2.4% as consumer balances continued to increase across most products. However, total non-mortgage debt did not grow equally across all risk tiers. Below prime average consumer balances grew 4.4%, with subprime consumers contributing the highest increase at 6.3%, while prime plus and super prime consumer balances remained mostly flat. The YoY growth in average balances among below prime consumers may be due to these consumers utilizing more credit to augment disposable income in the face of elevated prices. This trend was seen particularly with the growth in credit card and personal loan balances, as these are traditionally the products used by consumers for liquidity. Below prime consumer average balances across these products grew at a faster rate than overall borrower balance growth during this period. Additionally, the data shows regional disparities in the YoY growth rates of non-mortgage debt, although province rankings did not change from the previous quarter. P.E.I. and Newfoundland had the highest average debt per borrower, while Quebec and Manitoba had the lowest. While the gap between the highest and lowest average debt balances across provinces may not appear substantial, even modest differences in average debt per consumer can significantly influence delinquency rates. Consumers in provinces with higher average debt levels may be more susceptible to increases in interest rates as well as higher everyday living costs, making them more vulnerable to financial strain and increasing the likelihood of delinquency, particularly during economic downturns. 'The rise in balances from higher-risk and more vulnerable credit consumers signals a critical moment for lenders to reassess risk strategies and engagement models. Proactive credit monitoring, tailored financial support and early intervention tools can mitigate potential delinquencies while still maintaining consumer access to credit,' said Fabian. 'At the same time, consumers should continue to build financial resilience by understanding their credit profiles, seeking guidance when needed and using credit responsibly. Empowered, informed borrowers are key to a healthier credit ecosystem.' Lower Canada Consumer Credit Index Reflects Weakening Market Conditions Economic uncertainty has recently muted credit demand while supply remains strong. Additionally, uncertainty has shifted some credit behaviours as consumers balances have increased while credit performance has remained relatively stable from prior year, driving the Canada Consumer Credit Index to 100.3, down almost 6 points from the prior year. Differing Impact of Economic Volatility Across Risk Tiers A widening financial divide is emerging among credit consumers across Canada. While recent improvements in inflation and interest rates have provided relief for some, enabling them to reduce debt and strengthen their financial positions, others continue to face significant challenges. These consumers are still grappling with the prolonged effects of past economic volatility, highlighting an uneven recovery and growing disparity in financial resilience. Overall consumer-level serious delinquency (consumers 60 days or more delinquent on any credit product) was up 11 basis points YoY to 2.71% in Q1 2025. This increase was driven in part by the recent growth in new-to-credit consumers, who generally carry higher risk in their early years due to their limited credit experience. Even with the recent increase, the current levels of delinquency are similar to those seen prior to the pandemic. Subprime consumers have become more likely to experience delinquency soon after opening a new product, with the delinquency rate within the first six months of opening a new credit account doubling between 2020 and 2024. This is particularly evident for below prime credit card and personal loans, where consumers may be more sensitive to interest rates. Subprime consumers that opened a credit card in 2023 or 2024 were 1.7x–2.0x as likely to go delinquent within the first 12 months of holding that card than those who opened a card in 2020. These findings further demonstrate the increased vulnerability that subprime borrowers have to macroeconomic factors such as higher interest rates and increased cost of living. Geography is also playing a role in the vulnerability or resilience of consumers. A 16 basis point YoY increase in serious consumer delinquencies led to Alberta continuing to have the highest rate across all provinces in Q1 2025, driven by the volatility in oil and gas prices that play a large role in Alberta's economy. While Quebec remained the province with the lowest rate of delinquencies, it had a seven basis point increase YoY. 'We've seen volatility in delinquency rates attributed to a mix of regional economic pressures and demographic factors. Regional variations in both cost of living as well as wage growth, along with pressure from macro-economic cycles, disproportionately impact specific regions, and hence some provinces have had more volatile consumer credit performance,' Fabian said. 'These findings underscore the importance of regionally tailored lending policies and support systems to address the unique challenges faced by those households. Additionally, consumers in more vulnerable areas should stay vigilant in keeping current on payments, monitoring credit and building emergency savings.' About TransUnion (NYSE: TRU) TransUnion is a global information and insights company with over 13,000 associates operating in more than 30 countries, including Canada, where we're the credit bureau of choice for the financial services ecosystem and most of Canada's largest banks. We make trust possible by ensuring each person is reliably represented in the marketplace. We do this by providing an actionable view of consumers, stewarded with care. Through our acquisitions and technology investments we have developed innovative solutions that extend beyond our strong foundation in core credit into areas such as marketing, fraud, risk and advanced analytics. As a result, consumers and businesses can transact with confidence and achieve great things. We call this Information for Good® — and it leads to economic opportunity, great experiences and personal empowerment for millions of people around the world. For more information visit: For more information or to request an interview, contact: Contact: Katie Duffy E-mail: Telephone: +1 647-772-0969 Photos accompanying this announcement are available at
Globe and Mail
19-02-2025
- Business
- Globe and Mail
Canadian Consumer Debt Continues to Grow Despite Macroeconomic Relief
Key findings from TransUnion report: Despite stabilization of macroeconomic conditions, total consumer debt and delinquency rates continue to rise Gen Z consumers continue to drive credit market activity Credit card balances hit new milestone of $124 billion and delinquency rates rise even as average monthly card spend declines TORONTO, Feb. 19, 2025 (GLOBE NEWSWIRE) -- Total consumer debt in Canada hit a historic high of $2.5 trillion as outstanding balances across all credit products grew by 4.5% year-over-year (YoY) in Q4 2024, according to TransUnion's Q4 2024 Credit Industry Insights Report (CIIR). Balances grew due to a combination of increases in both mortgage debt and non-mortgage debt. Non-mortgage debt increased 5.8% YoY with balances continuing to rise across revolving products in Q4 2024. Line of credit balances grew 4.2%, while credit card balances continued a more rapid pace of growth, increasing 9.2%. Although the rate of growth has been slowing, the overall increase remains significant. Credit participation grew by 2.5% YoY, with 32.3 million Canadians holding at least one open credit product, a trend fueled in part by the recent decline in interest rates and inflation. Millennial and Gen Z consumers were at the forefront of this increase, collectively holding $1.1 trillion in outstanding balances, a 10% rise YoY. Gen Z consumers were the fastest-growing segment, with a 29% increase in credit participation as they diversify their debt beyond credit card debt. Canada Consumer Credit Index Hits Lowest Level Since 2021 The Canada Consumer Credit Index fell YoY to 99.8 in Q4 2024, its lowest December level since 2020. The decline indicates a deterioration in the overall health of the Canadian retail credit market, reflecting declining consumer behaviours and weakening market conditions. Although all elements of the index were lower than the prior years' values, slowing balances, declining demand and continued increase in delinquency rates were the strongest drivers of the decline. Credit Card Market Growth Slowing Credit card balances continued to grow, marking 31 months of consecutive YoY balance growth. However, this growth has moderated in recent quarters, indicating a stabilization in the market may be expected in 2025. Bankcard originations trended lower in recent quarters, though totals remained elevated in comparison to pre-2018 levels. The recent decline in origination totals was seen across most risk tiers, with subprime leading the decline, influenced by the decrease in new Canadians entering the market after a significant reduction in immigration volume. In an effort to manage delinquency rates, lenders have become more conservative within their risk tier targets at origination. Overall, bankcard originations dropped by 3.7% YoY, with the largest decline led by subprime at 6.9% YoY, while prime and near prime consumers grew by 3.7% and 0.4% respectively. The risk mix of originated bankcard accounts and credit lines remains consistent with 2018 and 2019 levels, indicating market moderation, metric stabilization and reversion to more familiar business cycles. Originations growth fell across all generations. Gen Z showed the least year-over-year impact, remaining relatively flat at a decline of only 0.1% from prior year as more young adults in this generation continue to enter the credit market each year. The remaining generations saw a significant drop off from prior years, as demand in these groups for additional credit may have waned as the economy improved. Lower inflation in recent quarters, combined with continued employment resiliency for consumers, may be driving consumers towards an improved financial health, where they balance their monthly expenses and monthly budgets. Reduced lender appetite may also play a role in this slowdown, resulting in a decrease in new credit card originations. However, despite the slowing of originations, credit card balance growth remained strong, up 9% YoY, though below the previous year's 13% growth. The growth fueled a new balance milestone of $124 billion in Q4 2024. This was driven by higher revolving balances as consumers paid down a smaller portion of their balances. Approximately 64% of outstanding balances were revolving in Q4 2024 (+157 bp YoY) indicating that consumers are increasingly carrying balances on their cards from month to month. Average credit card debt per borrower hit $4,681 in Q4, but has also been slowing relative to prior years, with average debt per borrower rising 6.0% YoY in Q4 2024 as opposed to 7.2% the year prior. Prime and below risk segments are increasingly tapping into their available credit, highlighting potential pockets of growing financial needs and a greater dependence on revolving debt to cover daily expenses. Despite positive economic indicators, including lower interest rates boosting home-related purchases, ongoing economic uncertainty, and high prices for goods and services have continued to weigh on consumer spending decisions. There has been a corresponding drop-off in average monthly card spend, which fell 2.6% from prior year. Overall pressure on consumers related to the higher costs of living and lower savings rates contributed to a rise in bankcard delinquency rates. Bankcard serious consumer-level delinquency levels, defined as 90 or more days past due (DPD), continued to climb higher to 0.93% in Q2 2024, up 9 bps YoY. 'In an environment where new account growth is slowing, credit card issuers need to focus on optimizing account management strategies,' said Matthew Fabian, director of financial services research and consulting at TransUnion Canada. 'Strengthening customer loyalty, fostering prudent balance growth and engaging younger consumers to enhance lifetime value are crucial. Equally important is vigilant monitoring for early warning signs of rising delinquencies.' Credit Card Lending Metric (Bankcard) Q4 2024 Q4 2023 Q4 2022 Number of Credit Cards (millions) 50.8 47.6 44.5 New Card Originations (millions)* 1.8 1.9 1.7 Average New Card Credit Limit* $5,963 $5,771 $5,688 Total Credit Card Balances (Market) in $ billions $124.7 $114.2 $100.9 Average Card Balance per Consumer $4,681 $4,430 $4,076 Average Credit Limit Per Consumer $19,124 $17,973 $16,969 Average Monthly Spend $2,136 $2,193 $2,137 Consumer-Level Delinquency Rate (90+ DPD) 0.93% 0.84% 0.75% * Acquisition results are presented one quarter in arrears Non-Bankcard Delinquencies Also Increase Despite Economic Improvements The current economic landscape is unique in that, despite relatively stable employment, there has been a rise in consumer loan delinquency rates. Solid employment has been offset by high interest rates that have put pressure on consumer wallets. Overall serious consumer delinquency continues to rise on a year-over-year basis, up 16 basis points to 1.83% and reaching a five-year high, back on par with the pre-pandemic levels. From a demographic perspective, Gen Z consumers are driving high delinquency rates with delinquencies up YoY 26 bps to 2.74% in Q4 2024. Gen Z credit consumers generally have lower risk scores as they are new to credit and have a shorter lending history. They may also be feeling a greater impact from inflation and the high cost of living, which may strain their budgets. Lenders will need to continue applying advanced analytics to grow and retain this segment, as Gen Z will remain a growing proportion of new credit consumers over the next few years and ultimately will become core credit consumers throughout their lifecycle. 'As the Canadian credit market expands, Gen Z consumers present a significant growth opportunity for lenders, especially through tailored credit card offerings,' Fabian said. 'Gen Z are educated and active credit users with a growing propensity to utilize credit throughout their lifecycle. Early management is crucial, as credit cards can be a valuable financial tool for Gen Z when managed responsibly. By implementing strategies such as education and regular credit monitoring, credit cards can become an asset rather than a financial burden for Gen Z consumers, creating loyalty to lenders who provide those services.' ** All data is sourced from the TransUnion Canada consumer credit database. About TransUnion ® (NYSE: TRU) TransUnion is a global information and insights company with over 13,000 associates operating in more than 30 countries, including Canada, where we're the credit bureau of choice for the financial services ecosystem and most of Canada's largest banks. We make trust possible by ensuring each person is reliably represented in the marketplace. We do this by providing an actionable view of consumers, stewarded with care. Through our acquisitions and technology investments we have developed innovative solutions that extend beyond our strong foundation in core credit into areas such as marketing, fraud, risk and advanced analytics. As a result, consumers and businesses can transact with confidence and achieve great things. We call this Information for Good® — and it leads to economic opportunity, great experiences and personal empowerment for millions of people around the world.
