Gen Z became the fastest-growing segment of Canada's credit market in Q1 2026

Gen Z added more than 460,000 credit-active consumers over the past year, a 7.8 percent jump that outpaced every other generation.  

TransUnion's analysis, released alongside its Q1 2026 Credit Industry Insights Report, said the cohort's non-mortgage balances also grew more than 9 percent year over year, the steepest rise of any age group.  

That shift signals a move from early credit adoption toward heavier credit use. 

That growth matters because the rest of the market is slowing.  

TransUnion said borrowing among older generations may moderate over the next three to five years as consumers pay down debt and ease new borrowing, leaving younger borrowers to drive a larger share of future credit growth.  

These trends could help lenders weigh risk against growth, especially among high-demand borrowers like Gen Z, said Matt Fabian, senior director of financial services research and consulting at TransUnion Canada.  

He framed the shift as an opening rather than a warning. 

The risk picture is improving even as participation climbs.  

Gen Z credit performance got better across all delinquency levels over the past year, with serious delinquency falling 11 basis points to 2.75 percent, the strongest YoY improvement of any generation.  

The group still posts the highest delinquency rate, which TransUnion linked to shorter credit histories and lower scores.  

Just 19.9 percent of Gen Z consumers rank as super prime, against 42.2 percent of the total population, leaving room for scores to rise as these borrowers mature. 

Canada's credit market is steadying and starting to normalize, Fabian said.  

Gen Z carries the highest delinquency rates of any generation but has improved its credit performance faster than the rest over the past year, he said, calling it "the strongest year-over-year improvement." 

Average non-mortgage balance per consumer by generation 

Source: TransUnion Canada Credit Database 

Across the broader market, credit stress is levelling off.  

TransUnion said total consumer delinquency at 90 or more days past due edged down YoY to 1.86 percent in Q1 2026, with most products peaking in early 2025 before stabilizing. 

Credit cards and lines of credit began to flatten, while personal loans showed continued repayment strain and auto lending recorded higher delinquencies, likely driven by higher vehicle costs and financing rates, with fraud potentially adding to elevated levels. 

Regional performance diverged sharply.  

Alberta remained an outlier at 2.43 percent, up 6 basis points YoY, consistent with regions tied to historically volatile industries.  

Manitoba, Newfoundland and Labrador, Nova Scotia and British Columbia all recorded YoY declines. 

Consumer-level delinquency rate (90+ days past due) on any credit product by province (percent) 

Source: TransUnion Canada Credit Database 

On the mortgage side, balances kept climbing.  

TransUnion reported total outstanding mortgage balances rose 3.85 percent YoY to $1.91tn, with the average balance up 4.3 percent to $290,528, which the bureau said may reflect ongoing affordability pressures.  

The national 90-plus-day mortgage delinquency rate reached 0.19 percent in Q1 2026, up from 0.16 percent a year earlier but broadly in line with pre-pandemic levels. 

TransUnion flagged a subtler concern: balance-level delinquency is rising faster than account-level delinquency, with the 90-plus-day balance-level rate up 29.3 percent YoY. 

The bureau said higher-balance loans are disproportionately represented in delinquency, amplifying potential loss severity even as overall rates stay contained. 

Delinquency rates remain low by historical standards but are edging up, Fabian said, as higher interest rates, elevated housing costs and persistent cost-of-living pressures squeeze households in pricier urban markets.  

Rising balances suggest "a gradual shift toward higher-severity risk," he said. 

Canada's Consumer Credit Industry Indicator ticked up one point to 100.4 in Q1 2026, flat from a year earlier.  

TransUnion tied the reading to steady balances, a small delinquency uptick and stable credit supply and demand, even as the index slips from its 2023 high.