Canadians to Carry $6.1 Billion in Post Holiday Debt as 37% Lean on Buy Now Pay Later

New Omnisend survey of 1,000 Canadians reveals a leaner, more cautious 2025 holiday season with 40% of Canadian adults saying they expect to have post holiday debt. Results indicate this could total $6.1 billion in total holiday debt, averaging $187 per adult Canadian.

At the same time, shoppers are deliberately shrinking their budgets – 76% plan to spend less than last year, and 61% intend to keep total holiday spend below $500. To bridge gaps, 37% consider using buy now, pay later (BNPL) for gifts (11% will, 26% might).

“Households are on a tighter budget in 2025. Inflation has ticked back up and trade instability is pushing some prices higher. The Bank of Canada is expected to start cutting rates this month, but borrowing is still costly and credit card late payments remain high. That’s why nearly half of shoppers tell us they’ll lean on buy now, pay later – to spread out gift purchases without piling on interest,” says Marty Bauer, Ecommerce Expert at Omnisend.

“BNPL isn’t niche anymore – last holiday set records for installment spending online. This season, the winners will be retailers who lead with price transparency, offer BNPL as a clearly explained option and make it easy to shop by budget with gift picks under $25, $50, and $100,“ continued Bauer.

Why budgets are shrinking and how shoppers are adapting

Among Canadians planning to spend less,

• 56% blame rising prices and inflation
• 18% express concerns about entering debt
• 14% point to reduced income or job instability

To stretch their holiday budgets, Canadians are increasingly turning to AI. One in four (25%) say they’ll use AI this season to hunt for the best deals, while another 10% plan to rely on it for budgeting and purchase planning.

“Canadian households are trimming holiday lists because the basics still feel expensive and paycheques feel shakier. Inflation has cooled overall, but housing costs remain high, unemployment just ticked up to 7.1%, and many mortgages are renewing at higher payments. In that backdrop, it’s sensible to buy fewer, smaller gifts– and to let AI do some of the legwork, from hunting deals to simple budgeting, so every dollar goes further,” says Bauer.