As many as one in five Canadians have missed their bill payments at least once since the beginning of the pandemic, according to a new study by Borrowell.
Citing credit score data from Equifax, Borrowell reported that Canadians in the “poor” credit score range (300-499) had an average of 1.295 missed payments on their credit reports. In stark contrast, those in the “excellent” credit score category (740-900) had an average of only 0.003 missed payments on their credit reports.
“The staggering difference between the rate of missed payments between Canadians with poor versus excellent credit scores illustrates the disparity between certain populations,” Borrowell stated.
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Consumers in British Columbia who are in the “poor” credit score group have the highest rate of missed payments nationwide. Burnaby saw an average of 1.840 missed payments per credit report, while Vancouver had 1.795, Victoria had 1.781, and Surrey had 1.724.
“It’s clear that consumers with low credit scores have experienced more difficulty over the past year than other Canadians,” said Andrew Graham, co-founder and CEO of Borrowell. “Low credit scores often prevent them from accessing affordable financial products to help them cover their bills. By only having access to financial products with high interest rates and stringent payment terms, these consumers end up stuck in a vicious cycle of high-interest debt, missed bill payments, and damaged credit scores.”