Industry Views & NewsMedia Releases

TORONTO – February 9, 2026 – Consumer insolvencies remained historically elevated in 2025, even as the pace of increases moderated from the sharp rise seen in 2024, as noted by the Canadian Association of Insolvency and Restructuring Professionals (CAIRP). Data from the Office of the Superintendent of Bankruptcy (OSB) shows that, for the full year, consumer insolvencies increased by 2.3% in 2025 compared to 2024, reaching 140,457 filings — the second-highest annual volume on record since the OSB’s tracking began in 1987, and the highest volume of consumer insolvencies in 16 years (since 2009). This represents an average of roughly 385 consumer insolvencies per day in 2025, which is about 10 more per day than in 2024.

While the rate of growth has slowed, consumer insolvency volumes remain elevated, reflecting the ongoing financial strain many Canadians continue to face amid higher living costs, rising debt loads, and lingering economic uncertainty.

“The modest increase in consumer insolvencies in 2025 suggests that financial pressure remains widespread, even as some economic indicators have begun to stabilize,” says Wesley Cowan, Licensed Insolvency Trustee and Vice Chair of CAIRP, the national voice on insolvency matters in Canada. “Many households are still feeling the cumulative impact of years of high inflation, higher borrowing costs, and stretched budgets.”

In the fourth quarter of 2025, consumer insolvencies dipped slightly compared to the third quarter, dropping by 3.8%, but were up 3.3% compared to the fourth quarter of 2024.

Even as consumer insolvency volumes have been relatively stable in recent quarters, total consumer debt has continued to rise. Equifax Canada reports that total consumer debt reached $2.62 trillion in Q3 2025, up 3.4% year-over-year, while average non-mortgage debt per consumer rose to $22,321, an increase of $511 year-over-year.

Cowan says this suggests many households may be “delaying the inevitable” by relying more heavily on credit to stay afloat rather than seeking help earlier. “When people are juggling rising costs with growing balances on credit cards, lines of credit, and other loans, they can feel like they’re managing, until they’re not,” he explains. “That can keep insolvency volumes steady in the short term, even as underlying financial stress continues to build.”

With many Canadians navigating higher mortgage payments, growing household debt, and persistent cost-of-living pressures, Cowan cautions that household finances may remain fragile in the months ahead.

“Even as inflation has cooled from its peak, everyday expenses remain significantly higher than they were just a few years ago. For homeowners renewing mortgages at higher rates, the impact on monthly budgets can be substantial, leaving less room for savings and debt repayment,” explains Cowan. “While the much-discussed mortgage ‘renewal cliff’ has not been as severe as some earlier forecasts suggested, higher payments for many homeowners are still squeezing household budgets and, in some cases, spilling over into missed or delayed payments on other credit. At the same time, while the job market has held up overall, conditions haven’t been the same for everyone, which is adding to financial anxiety for some households.”

As financial pressures persist, many Canadians may feel overwhelmed or uncertain about where to turn. Cowan emphasizes that support is available early and without judgement.

“Whether someone is already overwhelmed by debt or simply unsure of their options, Licensed Insolvency Trustees can help people understand what they’re dealing with and what their options actually look like,” says Cowan. “They typically offer free initial consultations, with no pressure or obligation, and clearly explain all available debt-relief options, which could include reworking a budget, consolidating debts, selling assets, or filing a consumer proposal or bankruptcy. They can also step in to stop collection calls and ease the stress of dealing with creditors. The earlier people seek guidance, the more options they usually have.”

Licensed Insolvency Trustees are the only federally regulated professionals authorized to provide tailored debt-relief solutions, including consumer proposals and bankruptcies, alongside budget guidance and debt management advice. They deliver reliable, unbiased recommendations so individuals can make informed decisions about what is best for their circumstances.

Initial consultations with a Licensed Insolvency Trustee are generally free. To find a government-regulated Licensed Insolvency Trustee, visit: www.cairp.ca/find-a-lit.html.

Among the provinces, British Columbia experienced the largest year-over-year increase in consumer insolvencies in 2025 compared to 2024, rising by 10.6% to 15,331 filings for the year. This was followed by Newfoundland and Labrador, which saw a 7.0% increase in consumer insolvencies, reaching 2,395, while Prince Edward Island experienced a 6.1% increase, totalling 593 filings.

Business Insolvencies Ease in 2025 Amid a Still-Challenging Environment

The number of business insolvencies declined in 2025, with an annual total of 4,840 filings, down 21.8% from 2024. While filings for the year have eased from recent highs, they remain 31.5% above the pre-pandemic average (2016–2019), underscoring that business insolvency volumes remain elevated.

In the fourth quarter of 2025, business insolvencies remained relatively stable compared to the third quarter, increasing 1.3%, but were down 15.8% compared to Q4 2024.

Many businesses are still contending with weak sales growth and softer demand. That continued caution is often reflected in businesses holding back on investment and hiring, rather than pursuing rapid expansion in the near term.

“Business insolvencies have come down in 2025, but that doesn’t mean the operating environment has suddenly become easy,” says Craig Munro, Licensed Insolvency Trustee and Chair of CAIRP. “Many businesses are still managing higher costs, tighter margins, and uneven demand, which continues to test their resilience.”

Looking ahead, ongoing economic uncertainty — including potential trade disruptions, fluctuating input costs, and shifting consumer behaviour — could continue to pose risks for certain sectors.

“Supply chain volatility and higher financing costs continue to weigh on many Canadian businesses, and ongoing uncertainty around cross-border trade and export demand remains a headwind, particularly for companies that rely heavily on international markets,” explains Munro. “Larger businesses are often better positioned to ride out these shifts, while smaller businesses are typically the first to feel these pressures, making it harder for them to weather unexpected shocks or prolonged periods of weaker demand.”

Munro stresses that early intervention remains critical for business owners facing financial strain. Licensed Insolvency Trustees can help assess financial viability and explore restructuring options before problems escalate.

“Speaking with a Licensed Insolvency Trustee can give business owners a clearer picture of their options, whether that means negotiating with creditors, restructuring debt, or making strategic adjustments to strengthen long-term viability,” says Munro.

Drawing on deep knowledge and experience in restructuring and insolvency, Licensed Insolvency Trustees bring an impartial, practical perspective that can help business owners make clearer, more confident decisions during periods of financial stress.

A small number of sectors continued to face disproportionate challenges in 2025. The only three sectors to see an increase in business insolvencies were Agriculture, Forestry, Fishing and Hunting (97 filings, up 2), Mining, Quarrying and Oil and Gas Extraction (38 filings, up 6), and Utilities (14 filings, up 1). By contrast, Accommodation and Food Services (654 filings, down 228), Transportation and Warehousing (373 filings, down 163), and Construction (742 filings, down 144) recorded the largest declines in insolvencies over the year, though Accommodation and Food Services still accounted for a significant share of total filings. Construction accounted for the largest share of insolvencies in 2025 (15.5%), followed closely by Accommodation and Food Services (13.7%).

ABOUT CAIRP

The Canadian Association of Insolvency and Restructuring Professionals (CAIRP) is the national professional association representing 1,400 members and associates. CAIRP members have earned the CIRP designation, and most are licensed insolvency trustees (LIT) providing insolvency and restructuring services to consumers and businesses who experience financial challenges. CAIRP is a national voice on insolvency matters throughout Canada.

For more information visit: www.CAIRP.ca

CONTACT

Angela Joyce, Media Relations

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e. aj@whiterabbitpr.com