Minimum credit card payments will rise from four per cent to 4.5 per cent in Quebec starting Aug. 1.
According to the Quebec Consumer Protection Office, they established a gradual increase in the minimum payment to avoid potential debt problems.
In 2019, the minimum payment started at two per cent for all credit card balances.
“So, for purchases of $1,000 with a credit card, the consumer’s minimum monthly payment will increase from $40 to $45,” reads a press release. “This little extra effort will allow him to repay his debt more quickly and, above all, save significant amounts of money. Because by repaying a larger amount each month, you pay much less interest and other credit fees.”
The new change will not affect consumers who pay their credit card in full each month.
The annual increase by half a percentage point came into effect in 2019 and will end in 2025.
The final increase is expected in August 2025, when the minimum payment will reach five per cent.