The Office de la protection du consommateur (OPC) has put out a reminder that the minimum payment for credit cards in Quebec is set to increase starting on August 1, 2020.
Minimum payments in Quebec will go up by half a percentage point to 2.5%. The legal minimum will go up by the same rate each year until it reaches a total of 5% in 2025. This new rule was put into law in 2017.
From August 1, the amount required as a minimum payment on the balance of a credit card will be 2.5% of the balance of the card.
Office de la protection du consommateur (OPC)
Since August 1, 2019, the OPC says, "all new credit card contracts include from the outset a periodic minimum payment that cannot be less than 5% of the balance."
The Office claims that this is to help "prevent over-indebtedness" among the public.
"Making only the minimum payment on a credit card can be costly for consumers," said the OPC.
"For example, for a balance of $1,000 on a card with a credit rate of 19.9%, a consumer who makes a minimum payment set at 2.5% would repay the debt in 14 years and 7 months, while paying $1,433.99 in credit fees. With a minimum payment of 5%, they would repay their debt in 6 years and would have to pay $441.87 in credit fees."