The president of a large credit reporting agency says Canadians are having more difficulty meeting their debts amid higher borrowing costs and inflation.

In an interview with BNN Bloomberg, Sue Hutchison, president of Equifax Canada, said she is seeing increased stress among Canadians regarding food and shelter costs, with mortgage delinquencies notably on the rise.

“Overall, we're seeing consumer proposals at quite an elevated level, and we are starting to see bankruptcies tick up,” Hutchison said on Tuesday.

“In particular, in Ontario and B.C., we're seeing quite a significant increase in missed payments and delinquencies.”

She said a significant portion of consumer debt is from mortgages, which have now reached $2 trillion in total debt, up about $80 billion on an annual basis.

“We expect to see tremendous pressure, or what we're calling payment shock, with our lenders over the next year or so,” Hutchison said.

CREDIT CARDS

Canadians are also relying more on credit cards to meet the cost of living, according to Hutchison, who has observed overall balances rising.

“Credit cards as a percentage of non-mortgage debt was about 40 per cent in Q3 last year. It's now 78 per cent, so total balances are growing,” she said.

“The other concern we have in that portfolio of debt is more and more Canadians are both missing payments, but also paying less, so paying their minimum payment versus paying the whole balance off.”

WHAT’S NEXT?

Going forward, Hutchison said lower interest rates could ease pressure on consumers, especially for people set to renew mortgages.

However, she expects that the cumulative effects of inflation will continue to apply pressure on Canadians.

On Tuesday, Statistics Canada reported the consumer price index (CPI) rose by 3.1 per cent on an annual basis in November, keeping the same pace from a month earlier.