The latest data from the Office of the Superintendent of Bankruptcy (OSB) shows that 35,114 Canadians filed a consumer insolvency in Q2 2025, up 2.6% compared to the previous quarter and remaining relatively stable (+0.1%) year-over-year. The Canadian Association of Insolvency and Restructuring Professionals (CAIRP), the national voice on insolvency matters in Canada, says the figures reflect the persistent financial stress across the country, with approximately one Canadian filing for insolvency every four minutes in the second quarter of this year.
“The rising cost of essentials, growing mortgage payments, and ongoing increases in everyday household expenses are compounding the pressure on Canadians already managing tight budgets or struggling with existing debt,” said André Bolduc, Licensed Insolvency Trustee and Chair of CAIRP.
Andre Bolduc
Bolduc notes that for individuals facing serious financial difficulty, insolvency can be a necessary step toward regaining stability.
“For many in lower-income brackets, especially those facing stagnant or declining wages as the cost of essentials rises, the financial burden can be especially severe, making it difficult to cover bills or reduce debt. Licensed Insolvency Trustees should be the first place to seek help, as they are the only professionals licensed and regulated by the federal government to provide debt relief solutions.”
The quarterly volume of consumer insolvencies remained roughly 4.9% above pre-pandemic norms for Q2, reinforcing the elevated level of financial distress many households continue to experience. Over the 12-month period ending June 30, 2025, consumer insolvencies increased by 4.9%, compared to the previous 12-month period ending June 30, 2024, explained CAIRP.
“As many households grapple with rising costs and lingering debt, speaking with a Licensed Insolvency Trustee can be a crucial step toward relief. They are the only federally regulated professionals legally authorized to administer consumer proposals and bankruptcies, and they have the authority to stop collection calls and wage garnishments,” it said.
“Ontario and Quebec together accounted for about 61.7% of all consumer insolvencies filed in the second quarter of 2025, highlighting the concentration of financial strain in Canada’s most populous provinces. Ontario saw the highest number of filings among all provinces, with 13,292 filings, and Quebec followed with 8,372 filings. While the largest number of filings occurred in Ontario and Quebec, the most significant increases were in smaller provinces, pointing to growing financial stress in other regions. Among all provinces, Newfoundland and Labrador (20.2%) recorded the largest year-over-year increase in consumer insolvencies, with notable growth also observed in British Columbia (7.0%) and Manitoba (5.3%).”
Business Insolvencies Show Decline, But Economic Pressure Remains
Business insolvencies in the second quarter of 2025 fell by 4.1% compared to the first quarter of this year, and 17.1% year-over-year. A total of 1,278 business insolvencies were filed in Q2 2025. Over the 12-month period ending June 30, 2025, compared to the period ending June 30, 2024, business insolvencies dropped by 15.2%. Still, filing volumes remain approximately 33.4% higher than the pre-pandemic second quarter average, highlighting continued strain in the business community, said CAIRP.
“This could be a brief moment of calm, but it doesn’t mean the storm has passed,” said Bolduc. “Global trade uncertainty and elevated debt carrying and input costs are making it increasingly difficult for many small and medium-sized businesses to stay afloat.”
Despite experiencing a year-over-year decline in the number of insolvency filings, the construction sector (210 filings, -23) recorded the highest volume of insolvencies among all sectors in Q2 2025, followed by the accommodation and food services sector (161 filings, -31). The retail trade sector recorded the third-highest volume of insolvencies (156), increasing by six filings year-over-year. The agriculture, forestry, fishing and hunting sector (31 filings) also experienced an increase, with seven additional filings compared to the same quarter last year. Insolvencies in these sectors can have a significant impact, especially in smaller communities where the closure of a single business can create ripple effects throughout the local economy, said the report.
Mario Toneguzzi
Mario Toneguzzi is Managing Editor of Canada’s Entrepreneur. He has more than 40 years of experience as a daily newspaper writer, columnist, and editor. He was named in 2021 and 2024 as one of the top business journalists in the world by PR News. He was also named by RETHINK to its global list of Top Retail Experts 2024 and 2025.
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