iStock
There s been a surge in the number of consumers who approached debt counselling firm DebtBusters in the first quarter of 2021.
As banks payment holidays came to an end, consumers started turning to debt counselling.
Debt levels of high-income earners are consistently rising, and low-income earners spend three-quarters of their net income servicing debt.
More consumers have started to seek the help of debt counsellors this year as bank payment holidays - some of which have extended for most of 2020 to accommodate those who still couldn t pay - came to an end.
DebtBusters, one of South Africa s largest debt counselling companies, said the number of consumers who made enquiries in the first three months of 2021 grew by 31% compared to the same period in 2020.
Canadians: 1 Way to Pay Off Debt in 2021
Canadians: 1 Way to Pay Off Debt in 2021
Canadians were already facing a dire personal debt situation before the COVID-19 pandemic shook up our daily lives. While the savings rates for Canadians have broadly improved during the pandemic, debt is still a major concern.
This has been compounded by mass job losses, especially in the service sector.
In a recent survey from the MNP Consumer Debt Index, 30% of Canadians said that they were already insolvent. This means that nearly a third of respondents had no money left at the end of the month to cover their bill payments. The survey found that the average Canadian is left with $625 after making their monthly payments – down 15% from December 2020.
While working people have confronted widespread impoverishment, illness and death, Canada’s capitalist elite has seen its wealth soar during the pandemic.
Non-investment grade credit had a mixed month with lower quality outperforming the higher quality segments of the markets. Overall, the senior floating rate loan market was flat on the month with private debt and global high yield seeing better returns. CLO debt had a strong start to the year with a meaningful rally in January, but the balance of the quarter was roughly flat, as gains in February were offset by modest weakness in the CLO market in March, largely driven by the record primary market activity that accelerated mid-quarter. The yield curve continued to steepen in March as the 10Y U.S. Treasury yield rose further in the month to a new 12-month high of 1.74%, which put pressure on longer duration, lower yielding fixed income. Improving issuer fundamentals, positive retail inflows in loans, record CLO originations along with better-than-expected macroeconomic data and rising inflation expectations fuelled investor interest in non-investment g