More Canadian consumers are filing for insolvencies at levels near those seen during the recession.
According to data from the Office of the Superintendent of Bankruptcy (OSB), the number of insolvencies increased in June 2024. Last month saw the third-highest peak in insolvency filings since the recession.
In June alone, 11,096 insolvencies were filed by consumers across Canada, with Ontario leading with 4,216 filings and Quebec with 2,626. That’s a total of 369 filings per day and an increase of 4.2% compared to the same time last year as more people find themselves in dire financial situations.
“The total number of insolvencies (bankruptcies and proposals) in Canada decreased by 9.2% in June 2024 compared to the previous month. Bankruptcies decreased by 16.8%, and proposals decreased by 6.6%,” reads a report by OSB.
“The total number of insolvencies in June 2024 was 4.9% higher than the total number of insolvencies in June 2023. Consumer insolvencies increased by 4.2%, while business insolvencies increased by 23.7%.”
JulieK2/Shutterstock
An overview of the entire year paints an equally grim picture.
The trend isn’t recent: the number of Canadians struggling to pay their debts has been on the rise. Over the past 12 months, struggling consumers filed 131,251 insolvencies — that’s 359 filings per day. That’s a 17.8% increase compared to the 12-month period ending in June 2023.
To put things in perspective, the highest recorded peak was in 2009, which saw 151,712 consumer insolvency filings, an average of 415 per day.
“For the 12‑month period ending June 30, 2024, the total number of insolvencies increased by 17.8% in comparison to the 12‑month period ending June 30, 2023,” states OSB.
These alarming numbers certainly raise the question: is there any relief for Canadians coming anytime soon?