Insolvencies in Canada increased by more than 11 percent in June, data show, with one expert suggesting that higher household debt, lower purchasing power, and higher interest rates are pressuring personal finances.
Consumers comprised roughly 97 percent of the insolvency filings and led the annual increase at 11.8 percent, although business filings also increased year over year by 5.5 percent, the data showed.
Furthermore, from Jan. 1 to June 30, 2026, there were 150,505 total insolvencies, a year-over-year jump of 5.3 percent from 142,921 filings, the report said.
The consumer insolvency rate—filings per 1,000 people—remained below pre-pandemic levels and below the 2009 financial crisis, while bankruptcy levels remained roughly 33 percent lower than pre-pandemic, he added.
However, insolvencies are on the rise in British Columbia, Alberta, Saskatchewan, and Ontario—above their 2019 levels—because they have higher ratios of debt-to-disposable income, St-Arnaud pointed out.
“Elevated household debt, stagnating purchasing power, and high interest rates have put pressure on households’ finances in recent years,” he said in his note.
While insolvencies have been stable since July 2025, this situation hides deterioration in many provinces, especially Ontario, B.C., and Manitoba, over the period, he remarked.
“High energy costs in recent months and their impact on inflation and household purchasing power could increase household financial stress,” St-Arnaud said.
Hallan pointed to a comment from personal insolvency service firm Hoyes, Michalos & Associates, which said the “uptick can be attributed to historically high consumer credit-card and tax debt.” The MP also referenced a report from Equifax, which found that one in four Canadians can make only the minimum monthly payment on their credit card.
Hallan said Canadians are paying for the highest food inflation in the G7, according to the Organization for Economic Co-operation and Development (OECD). With grocery prices rising by 3.9 percent in June, the MP said it’s “no wonder” that 76 percent of people report grocery costs as the biggest effect on their household finances.
“While Carney tries to sell the illusion that life is getting more affordable, Canadians experience the reality of higher prices at the checkout and weaker purchasing power under the Liberals,” Hallan added.
John Fragos, spokesperson for Finance Minister François-Philippe Champagne, said the Liberal government and Canadians alike are responding “to an unprecedented global economic challenge that is driving up costs and creating uncertainty and stress.”
He pointed to recent government measures that temporarily boosted payouts of the Canada Groceries and Essentials Benefit, cut the consumer carbon price, and paused federal fuel excise taxes as proof that Ottawa’s affordability agenda was reducing costs for Canadians.
“The government’s priority has been and remains making everyday life more affordable and steeling Canada’s economy to global shocks,” Fragos added.
