The current global COVID-19 pandemic is creating major economic and financial distress for consumers across the globe. Millions of jobs in the Canadian economy are either affected or at risk. To help organizations make decisions at a time when information on consumer impact is still emerging, TransUnion is conducting weekly surveys to better understand consumers’ perceptions and expectations in this rapidly evolving situation. Here are the main findings from the survey conducted in week three.
Government benefits, legislation and forbearance programs, and consumers getting their bearings in the crisis, have combined to ease some financial concerns.
However, the proportion of consumers saying they own a small business and are having to close now comprises 11% of those impacted. This indicates growing vulnerability in the small business sector, and we expect this percentage will continue to grow the longer lockdowns are in effect.
Both federal and provincial governments are launching additional measures to support small businesses.
Data collected in the week ending 13 April 2020 shows that:
Of the 59% of Canadians financially affected by COVID-19 (63% in week two):
Of those who say they’ve been affected financially, 66% are concerned about their ability to pay bills and loans — down slightly from the previous week (68%).
The Emergency Response Benefit may also be affecting the length of time consumers can pay bills:
Impacted Canadians said they will not be able to pay:
The drop in percentage points indicates consumers are benefiting from subsidies, getting better at managing through the crisis, or both.
On average, consumers who are affected expect they’ll be short by C$1,035.20 (up 8% from C$959.20 in week two) when paying bills or loans.
Gen X estimates increased by 24.5% week-over-week to C$1,222.80 — the largest increase of all generational cohorts.
Consumers who were impacted expect they will not be able to pay their bills or loans in 6.6 weeks (6.4 weeks in week two).
More consumers are turning to withdrawals from savings and retirement accounts to offset shortfalls. This is a concern, as it may affect retirement and overall net worth.
To date, two in five impacted consumers (40%) have reached out to the companies they have accounts with to discuss options. Separately, three in five impacted consumers (61%) indicated companies they have accounts with provided them with guidance on payment options.
As the world adjusts to new working practices implemented in response to COVID-19, fraudsters and cyber attackers have been quick to find ways of exploiting the pandemic to target businesses and individuals.
Almost 30% of respondents have been targeted by a fraud scheme related to COVID-19. This includes 25% who did not become a victim and 4% who did (double week two’s 2%).
Fraud is more prevalent among younger consumers with almost 40% of Gen Z responders being targeted. This makes sense as this generation is more predisposed to conducting transactions digitally and on mobile devices.
More consumers indicated they’re checking credit scores at least once a year (67%).
Younger generations are more likely to monitor their scores — nearly half of Gen Z consumers and two in five Millennials check at least monthly. Because these consumers are more digitally engaged, they’re likely using the free monitoring services provided by many lenders online and getting monthly updates pushed to their devices.
Of those who do monitor their credit score, half are taking advantage of the free monitoring services provided by lenders.
Additional resources:
We’ve developed several resources to assist businesses and consumers navigate this difficult time. To learn more about our weekly consumer research and download the latest reports and infographics, visit https://www.transunion.ca/financial-hardship-study#latest-report
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