New report says Canadian working poor face ‘staggering’ 428% debt-to-income ratio

CALGARY — Canada’s lowest-income earners are carrying more than four times their annual income in debt as financial pressure mounts among millions of consumers, according to Equifax Canada.As first reported by Blacklock’s Reporter, the credit monitoring company warned a Commons committee that the financial circumstances of many Canadians are significantly worse than national statistics suggest.“Our real-time data alerts us to deep financial stress across specific Canadian segments,” Equifax said in a submission to the Commons industry committee.The report was filed as part of the committee’s investigation into consumer fraud in Canada.Equifax said the debt-to-income ratio among Canadians in the lowest income quintile has reached 428%, compared with 130% for the country’s highest earners.“When the top quintile is excluded, Canada’s actual debt-to-income ratio exceeds 200%, far higher than the headline aggregate of 173%,” the company wrote.Consumers without mortgages are also missing payments at a much higher rate than homeowners with mortgages.At the end of 2025, approximately one in 17 consumers without a mortgage missed payments, nearly double the one-in-34 rate recorded among mortgage holders.Equifax said the divide has widened significantly since 2019, when missed payments among consumers without mortgages were only 50% higher than among mortgage holders.Financial strain is also beginning to affect Canadians who have historically been considered reliable borrowers.“Mortgage delinquencies are rising among consumers with traditionally high credit scores, signalling that prolonged financial strain is depleting the safety nets of historically insulated demographics,” said the report..More first-time buyers need parents to co-sign mortgages as affordability crisis deepens .Equifax did not provide further details on the increase.The company said its conclusions were based on millions of data points collected from lenders, governments, telecommunications companies and utilities.“Equifax manages the largest consumer data trust in Canada representing 30 million consumers and processing over 200 million records monthly,” said the submission.“This comprehensive ecosystem provides an immediate, granular pulse on financial consumer behaviour and emerging systemic vulnerabilities.”The findings followed March 26 testimony before the Commons finance committee by Equifax Canada CEO Sue Hutchison, who said national debt statistics obscure sharp differences between wealthy Canadians and the rest of the country.“Overall numbers conceal an underlying divergence in financial performance,” Hutchison testified.“Canada’s credit challenges are far more concentrated and severe than the surface numbers suggest. The debt-to-income ratio across Canada has risen for several consecutive quarters.”Matt Fabian, senior director at TransUnion Canada, told the committee that approximately one in 10 borrowers missed payments after interest rates surged following the pandemic.Fabian also warned that younger Canadians are carrying a large share of the country’s consumer debt.“Gen Z and millennial consumers combine to hold almost 50% of outstanding debt,” he said. “Much of this debt, especially among millennials, is mortgage debt.”

New report says Canadian working poor face ‘staggering’ 428% debt-to-income ratio

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