More than 1.4 million Canadians missed a credit payment in the first quarter of 2025, signaling growing financial stress across the country, according to a new report from Equifax Canada. That’s 146,000 more people than during the same period last year — and younger Canadians are being hit the hardest.
Equifax’s Consumer Trends and Insights points to economic uncertainty, rising unemployment, and the soaring cost of food and housing as the primary drivers behind the trend. Vice President of Advanced Analytics, Rebecca Oakes, says missed payments are rising sharply among low-income and younger consumers in particular.
“It’s not a great situation that we are in right now,” Oakes said, adding that younger Canadians are increasingly falling behind on car loans. Missed auto loan payments among those aged 35 and under have surged by 30% year-over-year.
Mortgage stress is also mounting, especially in Ontario. Many homeowners are scrambling to find lower rates, with nearly a third switching lenders. Equifax found that 28% of homeowners shopped around and changed mortgage providers — nearly half of them switching between Canada’s Big Five banks, a reflection of intense competition in the lending market.
Adding to the challenge is the growing gap between housing prices and income. A separate study from Desjardins shows that while home prices have climbed 320% over the last 25 years, disposable income has only risen by 110%.
Credit counsellors warn that anyone struggling to make payments should seek help early. “If you’re missing payments, you may already be cutting costs to the bone, missing necessities, and not sure where to turn,” said Mason Cox of the Credit Counselling Society. He cautioned that missed payments can quickly escalate into collection calls, legal notices, and long-term damage to one’s credit score.
One sliver of good news: credit card spending has dropped to a three-year low. Experts believe this may reflect a conscious effort by Canadians to avoid new debt and manage spending more carefully in the face of mounting financial pressures.