Almost all Canadian Gen Z adults have a credit card
The next generation of young adults are credit hungry despite growing up during the Great Recession.
A Transunion study of Generation Z (born in or after 1995) consumers over 18 across 6 countries reveals that the cohort has a desire to engage with lenders.
In Canada, 99.8% of Gen Z adults have a credit card, 28% have a student loan, 16% have an unsecured personal loan, and 5% have an auto loan. Canadian Gen Zs are the second most ‘credit active’ at 63% just behind the United States at 66%.
The thirst for credit is notable considering that this generation saw their parents hit by the global financial crisis more than a decade ago. Their confidence in taking on credit reflects the strength of the economy in recent years and little risk of imminent recession.
“Gen Z is the first generation of digital natives, and they have come to expect a seamless consumer experience across all walks of life – including how they access, use and manage credit,” said Laky. “Our belief is that the desire for credit among this generation is significant across the board and improving economic conditions will likely serve as a springboard for more credit, especially in emerging credit markets. It’s critical for lenders in both emerging and established economies to have the ability to make more informed decisions on prospective customers and earn their trust as well as their business.”
Access to credit
The report reveals that half of credit active Gen Zs are prime compared to 39% of Millennials at the same age.
“The oldest set of Gen Z consumers came of age during an elongated economic expansion and relaxed underwriting environment, which allowed for a comparatively easier entrance into the credit market than their Millennial counterparts,” said Matt Komos, vice president of U.S. research and consulting for TransUnion. “Gen Z has been able to access credit cards and auto loans with greater ease, particularly because lenders have been extending their buy-box into non-prime – which has been beneficial to these Gen Z consumers as they enter the credit market.”
Despite many of them growing up during economic recessions, Gen Z consumers — the youngest credit-active generation — have a strong appetite for #credit. Our new global study explores Gen Z’s credit behaviors and how #lenders can meet their needs. #GenZstudy pic.twitter.com/ernYX4Yves
— TransUnion B2B (@TransUnionB2B) January 29, 2020
