Canadian consumer debt delinquencies have surged to their highest levels since the 2009 financial crisis, with more than 1.4 million people missing at least one credit payment in the first quarter, according to data released by Equifax Canada on Tuesday.
Non-mortgage delinquency rates jumped 19% year-over-year to 1.43% nationally, even as average debt levels rose a modest 3.8%, the credit monitoring firm said. Total consumer debt reached C$2.55 trillion ($1.9 trillion) in the first quarter.
The sharp divergence between debt growth and missed payments signals mounting financial stress among Canadian households grappling with elevated interest rates and a wave of mortgage renewals at higher rates.
“We’re observing positive shifts in consumer behaviour, with reduced credit card usage and early signs of delinquency stabilization for some consumers,” said Rebecca Oakes, vice president of advanced analytics at Equifax Canada. “However, headwinds will likely persist, such as rising unemployment and rising food prices, in already strained regions.”
Ontario appears to be the epicenter of the crisis. The province reported mortgage delinquency rates of 0.24% for payments overdue by 90 days or more — a 71.5% surge from the same period last year. Alberta reported the highest provincial delinquency rate at 1.81%.
The crisis is being intensified by approximately one million mortgages facing renewal in 2025, many originated during the ultra-low interest rate environment of 2020-2021. A quarter of mortgage holders saw monthly payments increase by more than C$150 when renewing in the fourth quarter.
“The shift in the mortgage market is clear — this is currently about existing homeowners navigating a complex refinancing environment,” said Oakes.
Credit card delinquencies have hit younger Canadians particularly hard, with those under 26 posting rates of 5.38% — the highest among all age groups. Auto loan delinquencies among younger consumers rose 30% to 1.95%.
Major cities showed significant stress, with Toronto posting a 24% increase in delinquencies and Vancouver recording a 14% rise.
The Bank of Canada has implemented several rate cuts since mid-2024, but many mortgage holders remain locked into higher rates from the recent high-interest period. Consumer spending accounts for roughly 60% of Canada’s GDP, meaning widespread household financial stress could have significant economic implications.
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