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Canadian Bankruptcies Booming

One of the things that we are most proud of here at Synergy Merchant Services is our ability to help business owners across Canada meet their financial goals. Especially during these gruelling economic times, we encourage business owners to consider the growth and prosperity of their respective companies.

Because the repayment of a merchant cash advance is made through a small percentage of the credit and debit transactions a business makes, owners are ensured that they are never required to pay more than what they can reasonably afford.

Unfortunately, for many Canadians this past year, an increase of debt and an inability to make monthly payments to their banks and creditors are situations that are becoming the norm. So much so, that The Toronto Star's business reporter, Madhavi Acharya-Tom Yew writes today that Canadians are filing for bankruptcy seemingly more than ever before.

Writes Acharya-Tom Yew: “The number of bankruptcies rose by a staggering 51.6 per cent in June compared to the year before, as more Canadian consumers and businesses were unable to pay their debt. The report from the Office of the Superintendent of Bankruptcy of Canada, released yesterday, shows there were 11,338 filings in June, up from 7,478 for June, 2008.”

Sadly, such statistics only help to confirm that a startling number of Canadians are struggling with debt while unemployment rates continue to rise. The recession is truly taking its toll on the nation. While businesses are clearly feeling the effects of the recession, consumers seem to represent the majority of those filing for bankruptcy.

Acharya-Tom Yew writes that credit card delinquency has been steadily increasing across Canada for months with Toronto being cited as the city with the highest delinquency rate: 2.03 per cent.

Businesses in Toronto, naturally, have also been hit the hardest. Ontario and Quebec, in fact, lead the nation for having the most businesses declare bankruptcy. Two thirds of all businesses in Canada who are filing come from these two provinces. According to a report issued by Equifax Canada last week, “companies in retail, manufacturing, and construction accounted for most of the bankruptcies.”

Evidently, Canada has a long way to go before it is completely out of the recession. It is our hope, at Synergy Merchant Services, that we can help small to medium sized business across the country with meeting this goal.

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