Scotiabank says variable-rate mortgage clients “showing signs of stress” + MORE May 30th

Canada’s largest non-bank lender continued to see a slowdown in its residential mortgage originations in the first quarter, which were down 20% from last year.

If you’re from India, you’re in for a world of new experiences in Canada. Some things are the same as back home, while others are different. For example, driving a car is very much the same, but you now have to drive on the right side of the road. The same applies to your finances as well. Many aspects of living are similar to those you’re accustomed to, but they have different names in Canada. For example, the Canadian equivalent of a fixed deposit (FD) is a guaranteed investment certificate (GIC). Let’s dive in and demystify other Canadian finance terms using the closest corresponding ones from India.

Fixed deposit (FD) → guaranteed investment certificate (GIC)

Home loan → mortgage

Income Tax Department (IT Dept) → Canada Revenue Agency (CRA)

Income tax slab rate → marginal tax rate

Equated monthly installment (EMI) → loan payment

CIBIL score → credit score

S&P BSE 500 → S&P 500

Employee Provident Fund (EPF) → Canada Pension Plan (CPP)

Differences in banking between India and Canada

sponsoredThe Chequing Account For Newcomers to Canadago to site

Monthly fee: $0 for up to three years ($15…

A new report suggests an increasing number of Canadians are seeing their credit card balances balloon as the cost-of-living crisis and higher interest rates eat into household budgets. A TransUnion report published Tuesday said the number of Canadians paying only the minimum monthly amount on their credit card rose eight basis points to 1.3% in the first quarter compared with last year. 

What is causing debt for Canadians?

Matthew Fabian, director of financial services research at TransUnion Canada, said many household incomes are not keeping up with inflation and higher interest rates, leaving them to rely on credit.

“Consumers that have had significant increases in their mortgage payment have made that deliberate trade-off to pay less on their credit card and in some cases, they’re missing their payment,” Fabian said in an interview. “We’ve seen a higher delinquency rate in credit cards for those consumers that have mortgages than traditional credit card consumers…

Scotiabank says high interest rates are increasingly weighing on consumers, resulting in a credit deterioration among its variable-rate mortgage customers.

CMHC says the country’s total residential mortgage debt totalled $2.16 trillion as of February this year, up 3.4% year-over-year and representing the slowest growth in 23 years.