January 2025 Canadian Insolvency Statistics
TORONTO – February 28, 2025 – The first Canadian insolvency statistics of 2025 show a 20.5% increase in consumer insolvency filings in January compared to the previous month, according to the Office of the Superintendent of Bankruptcy (OSB). There were 11,196 consumer insolvencies filed in January, 1,904 more than in December, and an average of about 361 filings per day. Consumer insolvencies were 3.8% higher this January compared to January 2024, and 12.3% higher compared to pre-pandemic January 2019.
The Canadian Association of Insolvency and Restructuring Professionals (CAIRP) notes the rise in consumer insolvencies highlights the ongoing financial strain many Canadians continue to face amid the persistently high cost of living and mounting household debt, underscoring the need for stronger debt literacy.
“As financial challenges persist, it’s crucial for Canadians to understand their debt-relief options, and know who to speak with for trusted, knowledgeable support,” 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.
With the current economic uncertainty and the potential impacts of U.S. tariffs looming, Canadians already facing financial hardship may find it even more difficult to manage their debt obligations.
“Higher costs for goods and services, combined with existing financial pressures, could push more individuals towards needing debt-relief solutions,” says Bolduc.
In the 12-month period which ended January 31, 2025, consumer insolvencies increased by 9.9%, from the 12-month period which ended January 31, 2024. Amongst the provinces, New Brunswick experienced the largest year-over-year increase in consumer insolvencies in January, increasing 9.8%, followed by Quebec which saw an increase of 9.2%.
Bolduc says for Canadians who are feeling financially overwhelmed, Licensed Insolvency Trustees, who are the only debt professionals that are regulated by the federal government, are the most reliable resource and the best starting point. They are legally and ethically required to complete a full assessment of an individual’s financial situation and provide them with accurate, unbiased advice and information about all of the debt relief options available, so individuals are able to make informed choices about their debt.
“Debt-relief options can include both insolvency and non-insolvency solutions, such as negotiating with creditors, debt consolidation, consumer proposals or bankruptcy,” explains Bolduc. “A Licensed Insolvency will carefully review all available options in detail, and if an insolvency solution is the best path forward, they are the only professionals in Canada authorized to administer both consumer proposals and bankruptcies.”
Consumer proposals have become a widely chosen insolvency option for Canadians. In the 12-month period which ended January 31, 2025, consumer proposals accounted for 78.9% of insolvency filings, while bankruptcies accounted for 21.1%.
“Unlike bankruptcy, a consumer proposal often offers a more flexible repayment plan of up to 60 months instead of nine to 36 months, no ongoing income reporting, and removes uncertainty and the risk of payment increases,” explains Bolduc. “Additionally, those who have previously filed a bankruptcy often prefer to avoid going through the bankruptcy process again, particularly given the uncertainty of what the terms of their discharge from another bankruptcy might be.”
Bolduc adds that creditors have also become more open to negotiating consumer proposals, allowing for more tailored and manageable repayment terms. Moreover, with a consumer proposal, a debtor can retain their assets such as their home.
“While a Licensed Insolvency Trustee carefully reviews all available options with individuals, many debtors see consumer proposals as a more dignified solution that helps them regain financial stability without the perceived stigma of bankruptcy,” says Bolduc.
Once a Licensed Insolvency Trustee has filed a consumer proposal or bankruptcy, individuals often experience a sense of relief knowing that collection calls, wage garnishments, and legal actions from creditors will stop. This breathing room allows them to focus on a path toward financial recovery.
“Despite the stigma that sometimes surrounds insolvency, it’s important to recognize that seeking debt relief is a responsible step toward regaining financial control,” says Bolduc. “Many indebted Canadians are hardworking individuals who have encountered financial setbacks due to circumstances beyond their control, and taking action can provide the stability and peace of mind needed to rebuild their financial future.”
Licensed Insolvency Trustees typically offer free initial consultations, giving individuals access to trusted, no-obligation advice to help them navigate their debt-relief options. To find a government-regulated Licensed Insolvency Trustee visit: www.cairp.ca/find-a-lit.html.
Business Insolvencies Increase 7.6% in January
In January, there were 424 business insolvencies filed in Canada, increasing 7.6%, 30 more filings than in December. Filings remain 45.2% above pre-pandemic levels in January 2019. Business insolvencies in the 12-month period which ended January 31, 2025 were 11.7% higher than the 12-month period which ended January 31, 2024.
The sectors with the largest increases in the number of insolvencies in January compared to December were accommodation and food services (59 filings, +17); professional, scientific and technical services (41 filings, +13); and arts, entertainment and recreation (11 filings, +9) The accommodation and food services sector accounted for the largest share of insolvencies in January, at 14.1%.
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
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