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Explore global credit and financial data insights. Delivering trends in credit risk, debt, utilization and delinquencies from around the world.
Executive Summary
Here are 3 top trends in the first half of 2024:
Economic pressures impact young adults
High cost of living and increased cost of credit are affecting young adults at a greater rate. Consumers under 36 years of age are particularly impacted with high auto loans and lines of credit delinquency rates. Plus, a growing number of young Canadians are finding themselves living with their parents and grandparents. Currently, almost one in three Canadian households (29.2%) include adult children living with their parents, up from 26.7% a decade ago.
Younger consumers more susceptible to holiday spending hiccups
Over the past two years, credit cards issued in Q4 have shown a higher rate of delinquency compared to cards issued in other quarters. This trend coincides with increased demand for credit cards since 2022, driven by inflation and economic challenges. Young consumers are more likely to both use unsecured credit for holiday spending and fall behind on payments; the credit card delinquency rate for 18-25 year olds opening accounts in Q4 is 2x the rate for consumers aged 36-50.
Increased digital activity leads to increased fraud risk
As digital interactions continue to increase, so do fraud vectors, including Synthetic Identity Fraud. In the United States, the number of credit applications for auto loans tagged with having a risk of Synthetic IDs increased from ~5% in 2019 to above 8% in 2023. Overall, credit applications with a Synthetic ID risk have a delinquency rate 3 to 5 times higher vs the portfolio average.
