Missed Credit Payments Jump 4 Percent in Q1 2025

There is a widening divide among Canadian consumers as economic uncertainty pushes more people behind on payments, according to a new Equifax report. The findings show that missed payments have increased compared with a year ago, highlighting stresses across different age groups, regions and debt types.

Rebecca Oakes, Equifax Canada’s vice-president of advanced analytics, attributes much of the trend to sustained pressure on household finances from a higher cost of living, labour market shifts and the broader climate of economic uncertainty, including rising trade tensions.

“To keep making payments consistently, consumers need steady income and stable employment,” Oakes said. “When there’s economic uncertainty, that creates a ripple effect through household budgets and repayment behaviour.”

The report found that one in 22 Canadians—roughly 1.4 million people—missed at least one credit payment during the first quarter. At the same time, the average monthly credit-card spending per cardholder fell by $107, suggesting many households are cutting discretionary spending to cope with tighter budgets.

Equifax notes that pulling back on discretionary purchases not only eases some household pressure but also reduces revenue for businesses, which can feed back into employment and income prospects. “That knock-on impact can, in turn, make it harder for people to keep up with their financial commitments,” Oakes added.

The data show a sharper rise in delinquency among non-mortgage borrowers: consumer-level delinquency rates for non-mortgage accounts increased 8.9% year-over-year, compared with a 6.5% rise among mortgage holders. Average non-mortgage debt per consumer rose to $21,859 in the first quarter, driven in part by strong activity in the auto-loan market as buyers moved quickly to secure vehicles ahead of potential tariff-related price increases.

Missed payments rising fastest among consumers aged 18 to 25

The report highlights that younger adults are among the hardest hit. Credit-card delinquency for consumers aged 18 to 25 reached 5.38%, a 21.7% increase year-over-year. This suggests that younger cohorts—who may face lower wages, more precarious employment, or rising living costs relative to income—are finding it increasingly difficult to meet credit obligations.

“If your living costs rise or you face difficulty securing stable work, while credit commitments remain the same, keeping up with payments becomes more challenging,” Oakes explained. The behaviour of younger consumers, including reduced discretionary spending, contributes to broader economic effects as businesses see softer demand.

Total consumer debt in Canada rose to $2.55 trillion in the first quarter, an increase of 4% year-over-year, though the figure was slightly lower—by more than $6 billion—than at the end of 2024. These figures underscore the scale of household liabilities and how small shifts in repayment patterns can have wider implications for financial stability.

More Ontario home owners missing mortgage payments

Mortgage renewals are another pressure point. Many homeowners who secured low mortgage rates early in the COVID-19 pandemic are now facing renewal decisions—and the report refers to this wave of renewals as “the great renewal.” When rates increase or terms change at renewal, monthly payments can rise and strain household budgets.

Ontario emerged as a regional hotspot in the first quarter, with the province’s 90-plus day mortgage delinquency rate rising to 0.24% year-over-year. Equifax’s data show that missed mortgage payments among Ontario homeowners increased noticeably during the period.

Ontario also recorded the largest rise in non-mortgage delinquency, up 24% year-over-year, followed by Alberta and Quebec. These regional differences reflect variations in local labour markets, housing costs and the timing of mortgage renewals across provinces.

Read more about debt:

• What is a consumer proposal? How does it work?
• Invest or pay off debt: A comprehensive guide for Canadians
• Why Canadian consumer debt continues to grow
• How much credit card debt does the average Canadian have?