A new report reveals a troubling surge in delinquency rates in early 2025, hitting levels unseen since just after the last major recession.
Equifax Canada highlighted that younger and lower-income Canadians are being hit hardest, with the 18–25 age group seeing a 15.1 per cent annual increase in delinquency rates. Missed auto loan payments among consumers under 35 also rose by 30 per cent.
New credit card approvals dropped by 10.3 per cent in the first quarter of 2025, and average monthly spending per cardholder fell by $107 — reaching the lowest level since March 2022. Equifax said lower-credit borrowers accounted for a greater share of these new cards, suggesting increased credit reliance among consumers who were struggling financially.
“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.”
In total, one in every 22 consumers missed a credit payment in the quarter.
Ontario saw the sharpest rise in missed mortgage payments, with 90+ day delinquencies jumping 71.5 per cent year-over-year, reaching 0.24 per cent. Non-mortgage delinquencies in the province climbed 24 per cent.
Oakes noted that the mortgage market is undergoing a shift as renewals and refinancing dominate new activity. As pandemic-era mortgages come up for renewal, Oakes referred to the trend as the “Great Renewal.” New mortgage originations rose 57.7 per cent annually.
“The shift in the mortgage market is clear — this is currently about existing homeowners navigating a complex refinancing environment,” she said. “But even as some find relief, affordability challenges haven’t eased for everyone.”
Total consumer debt reached $2.55 trillion by the end of 2025’s first quarter, slightly below the all-time high at the end of 2024 despite being a technical annual increase when compared to 2024’s first quarter.
The average non-mortgage debt per consumer rose to $21,859, reflecting continued financial pressure despite slowed borrowing overall.
Equifax also reported a drop in payment rates, especially among younger consumers, reinforcing concerns over growing financial strain in that group.
Non-mortgage consumer delinquency rates rose 8.9 per cent annually, compared to 6.5 per cent for mortgage holders. Ontario led the rise in non-mortgage delinquencies, up 24 per cent year-over-year, followed by Alberta at 15.9 per cent and Quebec at 13.9 per cent.
The report also highlighted that consumers under 26 had the highest 90+ day credit card delinquency rate at 5.38 per cent — a 21.7 per cent increase over last year.