Canadian consumers will increasingly request new credit over the next six months – more so than our neighbours to the south – according to analytics software company FICO (NYSE:FICO).
In a survey of bankers across North America, FICO found that almost half of respondents feel requests for credit-line increases are expected to go up, but that the Canadian appetite for more credit seems to be stronger.
"The survey found that in Canada, the willingness to acquire credit differs somewhat to that of our U.S. neighbour," said Cheryl Woodburn, senior director of FICO Canada.
"Despite recent warnings from the federal government and the Bank of Canada regarding high household debt-to-income ratios, our survey shows that 54% of the respondents believe Canadian consumers will request more credit in the next six months, compared with the North American average of 46%."
Other findings of the survey include:
- 50% of respondents feel that borrowers in the 30-39 age range will drive most of the growth, while 22% feel the strongest demand will come from those aged 20-29 and 18% believe those over 40 will request the most new credit;
- 69% of bankers expect the total number of credit delinquencies overall to remain flat, but 49% of respondents expect an increase in student loan delinquencies; and
- 72% feel interest rates will increase in the next six months.
