The Canadian payments landscape is evolving at an accelerated pace. New payment innovation and technological advancements have introduced a plethora of alternative financial solutions.
Canadians want access to more convenient, secure, and faster payment solutions in this modern era. Primarily digital solutions are growing in popularity, including mobile transactions and contactless payments.
The Future of Payments in Canada
The Canadian Payments Methods and Trends Report for 2019 paints an interesting picture. It shows how 21.1 billion payment transactions were conducted in Canada throughout 2018.
Surprisingly, the average transaction size continues to grow year over year. Compared to 2013, those amounts have grown by 22% to CA$468.
The vast majority of payment sin Canada occurs through electronic means, and represent 59% of the combined value of the total transactions nation-wide.
Perhaps the most surprising trend is how cash usage is on the decline. It is believed that cash has lost 40% in total payments volume between 2013 and 2018. Canada is one of the few countries where going cashless is a somewhat viable option these days.
Contactless and mobile payment solutions notice an increase in adoption. They is a viable substitute for cash transactions, mainly due to mobile devices becoming more accessible in the past few years. Nearly 35% of Canadians conduct contactless transactions through a mobile device. Significant growth, but most consumers favored contactless payment cards in 2018.
Payments Canada Head of Research and Strategic Foresight Cyrielle Chiron adds:
“There has been a remarkable transition from paper-based to digital payments over the last five years, but there is still a huge opportunity and need to advance Canada’s payments landscape. Looking to the future, our Modernization program is laying the groundwork to ensure Canadian consumer and business needs for more control, convenience and affordable payments, are met.”
Despite the push for innovative solutions, Canadians remain loyal to payment cards. It is the second-highest ranked country for credit card volume. Both debit and credit cards represent 29% of the Canadian payment volume respectively.