As we move through 2025, the financial pressure on Canadian small businesses is becoming increasingly clear. According to the latest Equifax Q1 2025 Business Credit Trends and Insights Report, business credit delinquencies are rising, credit applications are falling, and many industries, especially equipment-heavy ones, are showing signs of financial strain.
At CanaWealth Capital Corp., we believe knowledge is power. Understanding the trends behind the numbers helps Canadian business owners make smarter decisions when it comes to managing cash flow, protecting assets, and planning for growth.
Delinquencies on the Rise: The Credit Landscape in Q1 2025
Equifax reports a 14.6 percent year-over-year increase in business delinquencies. This marks the highest rate since 2009. Over 309,000 businesses missed at least one payment in Q1, representing 11.3 percent of all credit-active firms. The sectors feeling this the most:
- Accommodation & Food Services: 16.9 percent delinquency
- Retail Trade: 13.2 percent delinquency
These industries are highly sensitive to reduced consumer spending and tight margins, conditions that also impact sectors like construction, agriculture, and transportation.
A Drop in Credit Applications Signals Caution
Applications for new business credit are down 6 percent year-over-year, according to Equifax. This suggests that small business owners are becoming more risk-averse, opting to manage current debt loads rather than take on new liabilities.
But here’s the challenge: while avoiding traditional debt may feel safer, it can also limit access to the equipment and technology needed to stay competitive.
Why Leasing Is Gaining Ground in 2025
With financial institutions tightening credit, more Canadian businesses are turning to equipment leasing as a strategic alternative to loans. Here’s why:
- Preserve cash flow: No large upfront purchase costs
- Tax advantages: Lease payments are often deductible
- Access to better equipment: Stay current without overextending capital
- Easier approvals: Especially for B and C credit clients
At CanaWealth, we specialize in helping Canadian businesses lease equipment without tying up working capital or jeopardizing long-term financial health. In an economy where every dollar counts, leasing is no longer just an option, it is a strategy.
Shifting Priorities: Who Gets Paid First?
The Equifax report highlights a telling shift in payment behaviour:
- Delinquencies on loans and credit lines: Up 15.5 percent year-over-year
- Delinquencies on supplier payments: Up only slightly
This suggests many businesses are prioritizing supplier relationships to keep operations moving, while falling behind on banking obligations. It is a sign of tactical survival.
Sectors Facing the Most Pressure
Some of CanaWealth’s core industries are among the hardest hit:
- Agriculture: +19.5 percent missed payments
- Transportation & Warehousing: +19.3 percent
- Real Estate: +17.0 percent
- Manufacturing: +10.2 percent
If your business is in one of these sectors, now is the time to consider creative capital solutions that align with your cash flow realities.
Final Word: Resilience Through Smart Financing
Business uncertainty may be the new normal. That does not mean you have to stand still. At CanaWealth Capital Corp., we provide flexible leasing solutions for equipment in construction, forestry, agriculture, transportation, and more. We work with A, B, and C credit clients across Canada.
If traditional financing is out of reach, leasing might be the bridge that keeps your business moving.
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