A growing number of Canadians are steadily inching towards their financial breaking points, CAIRP says
Canadian consumer insolvency filings saw their largest proportional growth in 13 years with a 22.5% annual increase during the third quarter, according to the Canadian Association of Insolvency and Restructuring Professionals.
Consumer insolvencies increased by 2.3% on a quarterly basis, with the number of filings gradually veering back to pre-pandemic levels. A total of 25,860 Canadians filed consumer proposals or bankruptcy during Q3, CAIRP said.
“The concern is that more Canadians are reaching their breaking point financially, and as many desperately search for solutions to their debt problems, they may be lured by unrealistic promises to quickly solve their debt problems or fix their credit score,” said André Bolduc, licensed insolvency trustee and vice chair of CAIRP.
“Unfortunately, those promises can end up being too good to be true.”
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New business insolvency filings were 48.5% higher on an annual basis despite remaining steady quarter-over-quarter. This represented the largest percentage increase for this metric in 35 years, CAIRP said.
The most significant increases in the number of insolvencies during the 12-month period ending September 30 were seen in the accommodation and food services sectors, along with the construction industry.
