TORONTO – February 4, 2025 – Canada experienced its highest volume of consumer insolvencies in 15 years, surpassing levels not seen since the 2009 Great Recession, according to the Canadian Association of Insolvency and Restructuring Professionals (CAIRP). The data from the Office of the Superintendent of Bankruptcy (OSB) reveals that consumer insolvencies rose by 11.4% in 2024 compared to the previous year. This sharp increase amounts to 137,295 filings—over 14,000 more than in 2023—averaging about 375 insolvencies per day. The surge underscores the mounting financial pressures faced by many Canadians amid increasingly challenging economic conditions.
“The rise in consumer insolvencies last year highlights the severity of the financial pressures many Canadians are experiencing, exacerbated by rising living costs and economic instability,” says André Bolduc, Licensed Insolvency Trustee and Chair of the Canadian Association of Insolvency and Restructuring Professionals (CAIRP), the national voice on insolvency matters in Canada.
Consumer insolvencies increased 6.1% in the fourth quarter of 2024 compared to the same period in 2023, while declining modestly by 2.5% from the third quarter of 2024.
With many Canadians concerned about the impact of potential tariffs and upcoming mortgage renewals at higher interest rates, Bolduc warns that these factors could further strain household finances in 2025.
“The rising cost of living is putting increasing pressure on already stretched household budgets. At the same time, homeowners facing mortgage renewals this year may see significant increases in their monthly payments, leaving less room for essential expenses and debt repayment,” says Bolduc.
As financial pressures mount, many Canadians may feel overwhelmed by increasing debt. Bolduc stresses that help is available, explaining, “Licensed Insolvency Trustees provide expert guidance to Canadians struggling with debt, as the only federally regulated professionals authorized to provide tailored relief options, including consumer proposals, and bankruptcy as well as budget management and debt consolidation options.” Bolduc adds, “Licensed Insolvency Trustees deliver reliable, unbiased advice, ensuring individuals have access to every available solution.”
Initial consultations with a Licensed Insolvency Trustee are typically free. This provides individuals with valuable advice and no obligation, helping them better understand their debt-relief options. To find a government-regulated Licensed Insolvency Trustee visit: www.cairp.ca/find-a-lit.html.
Amongst the provinces, Ontario experienced the largest year-over-year increase in consumer insolvencies in 2024 compared to 2023, jumping 17.8% with 51,637 filings. This was followed by Quebec, which saw a 12.1% increase in consumer insolvencies, reaching 34,290, while P.E.I. experienced an 11.4% increase in consumer insolvency filings, totalling 559.
Business Insolvencies Surge 30% in 2024, Hitting a 15-Year High
Business insolvencies jumped significantly in 2024, with a total of 6,188 filings, up 28.6% from 2023. This marks the highest number of filings in 15 years, underscoring the financial challenges many businesses faced in an uncertain economic environment. About 1,400 more businesses filed in 2024 compared to the previous year. Business insolvencies remain 68.2% higher than they were pre-pandemic in 2019.
Compared to the previous quarter, business insolvencies remained stable in the fourth quarter, rising 1.5%. However, compared to the fourth quarter of 2023, business insolvencies decreased by 12.4%.
“The record high number of filings last year shows that many businesses already face significant obstacles. Many have been struggling to stay afloat since the pandemic, grappling with ongoing pressures from high operational costs and weakened consumer spending,” says Bolduc.
With 2025 expected to present even greater challenges for businesses, including potential tariffs imposed by the U.S., there could be further financial strain for businesses already operating on the edge.
“Rising production costs, supply chain disruptions, reduced consumer demand, and overall uncertainty are making it increasingly difficult for Canadian businesses to maintain financial stability, particularly for those reliant on cross-border trade or already facing significant strain,” explains Bolduc. “Small and medium-sized enterprises (SMEs) are especially vulnerable to tariff-driven price hikes and the loss of key export markets, as they often lack the financial flexibility to withstand these pressures.”
Bolduc emphasizes that proactively addressing these challenges is key to mitigating long-term financial risk and establishing a path to stability. Licensed Insolvency Trustees can be a lifeline for business owners worried about potential financial strain, offering trusted expertise and guidance during uncertain times.
“Speaking with a Licensed Insolvency Trustee can provide business owners with a clear understanding of their financial situation and potential solutions to help safeguard their business. They can help business owners explore viable options, whether it is negotiating with creditors, restructuring their debt, or even assessing the need for a more strategic pivot to ensure their long-term success,” says Bolduc.
Licensed Insolvency Trustees bring specialized expertise to businesses facing financial strain, offering a comprehensive approach to debt management and restructuring. They have the training and expertise to evaluate a company’s financial situation and guide business owners through restructuring options or corporate workouts that can restore viability. If recovery is not feasible, they can also provide guidance on formally winding down operations. Their expertise in both financial strategy and legal frameworks allows them to offer objective, tailored solutions that can help businesses regain stability and navigate a path forward during periods of economic uncertainty.
Some sectors were hit harder than others in 2024. The construction sector experienced the largest increase in the number of business insolvencies, rising by 205 filings compared to 2023, followed by the transportation and warehousing sector (+198) and the accommodation and food services sector (+163). The construction sector accounted for the largest share of insolvencies in 2024, at 14.3%.
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