Will Payment Deferrals Hurt Canadians in the Long Run?

Understand the impact of payment deferrals on the economy through the lens of behavioural science.

Tune in right below!

As of June 24th, Canadian banks had processed over 450,000 credit card deferral requests and over 740,000 mortgage deferral requests. The top six banks have deferred mortgage repayments at nearly double the rate of their U.S. counterparts, accounting for approximately 16% of their mortgage portfolios, which amounts to over $250 billion. The president of the Canada Mortgage and Housing Corporation (CMHC), Evan Siddall has expressed his concerns with the current situation, including the prospect of up to 20% of Canadian mortgages falling into arrears.

Many people, driven by well-documented behavioural biases, fail to grasp the negative impact that this will have on their finances over the long-term, and instead treat the deferrals as a way to enjoy some extra cash for discretionary spending. What many may not be considering is that the payment holiday will eventually end!

Join myself, and David Lewis and Kelly Peters of BEworks, as we discuss necessary changes to discretionary spending so that they can be prepared to resume payments when required.

Comment with your questions, or feel free to email me!

KELLY PETERS, CEO and Co-founder of BEworks

Kelly founded BEworks with Professors and renowned behavioral scientists Dan Ariely and Nina Mazar in 2010. Kelly has extensive experience in the field of behavioral science leading a portfolio of hundreds of experimental BE projects around the world, solving challenges in financial decision-making, health, and happiness. Kelly developed the BEworks Method, which is a proprietary framework for how to drive marketing, innovation and organizational transformation. She frequently speaks about the value of behavioral insights and scientific thinking to business leaders and policy makers. In addition to serving as a visiting lecturer at Cornell, Harvard, and Boston University, she is on the Faculty at Rotman School of Management at the University of Toronto.

DAVID LEWIS, Chief Client Officer of BEworks

David Lewis is the Chief Client Officer at BEworks. At BEworks, David promotes the application of behavioral economics to solve organizations’ most challenging problems. David earned his PhD in Marketing (Consumer Behavior) from the Lazaridis School of Business and Economics at Wilfrid Laurier University. He completed his MBA in Finance and Strategy at the Schulich School of Business at York University, and is also a Chartered Financial Analyst.

Prior to joining BEworks, David was an Assistant Professor at the Ted Rogers School of Retail Management at Ryerson University. David has held numerous senior positions including Head of Technology, Head of Marketing, President, CEO, and Chairman of the Board, at global financial institutions including Barclays Wealth USA, UBS Bank USA, UBS Financial Services Americas, ING DIRECT USA, and Bank of Nova Scotia. Ad Age magazine has also recognized him as being one of the Top 50 marketers in the United States.