Canada Payments Market Size (2024 - 2029)

Canada Payments Market Analysis

The Canada payments market is expected to register a CAGR of 15.4% during the period of 2022-2027. The primary factor driving the growth of the market in the region is the recurring payments setups, online payments, and robust growth in E-commerce, among others.

• New payment technologies give Canadians more choice, and the options are getting faster, easier to use, and more convenient. Likewise, payment systems now offer more speed; and more than ever, they're globally connected and easy to access. The Bank of Canada invests in backup systems to ensure smooth and resilient operations, even in disruptive events.
• Furthermore, as per the Bank of Canada, about 30 million financial transactions take place in Canada daily. Credit cards, debit cards, and electronic fund transfers are Canada's most preferred payment options.
• Payments Canada operates the country's two main payment systems, which the Bank oversees: The Large Value Transfer System (LVTS) and The Automated Clearing Settlement System (ACSS). Banks and other financial institutions use the LVTS to make very large payments safely and instantly. At the same time, ACSS settles small-value retail transactions between buyers and sellers that are paid by cheque, debit, or pre-authorized payments.
• There has been a rapid technological change in the field of electronic money and payments in recent years in the region. The trend toward electronic payments is likely to accelerate in the future. These developments can fundamentally change how Canadians pay for goods and services over the Internet and in traditional point-of-sale transactions.
• Innovation in payment technology has increased the country's productivity and expanded the size of the Canadian economy. Banks in Canada are heavily invested in Payment Canada's payment modernization project, including the Real-time Rail, which will allow Canadians to make payments and receive funds in seconds every hour of every day. This is in addition to investments that have been made in Canada's high-value payment system, which is the backbone of Canada's financial market infrastructure.
• However, payment constraints and transfer limits are the most prevalent payment challenges in the Canadian payments market, which can hamper the market's growth. These encounters primarily relate to either limits on transfer amounts or payment choice constraints when consumers cannot choose their preferred payment method.
• The COVID-19 pandemic deeply impacted the payment industry in Canada. Lockdowns and brick-and-mortar business closures restricted Canadians from making in-person purchases and changed the way they transacted before the outbreak. While overall spending decreased due to concerns about the economy and personal finances, Canadians spent more money online, accelerating the shift from cash to digital payments. At the same time, there was a sharp rise in contactless payment solutions, such as cards, smartphones, and wearable devices.

Canada Payments Industry Segmentation

The Canada Payments Market is segmented by Mode of Payment (Point of Sale (Card Payments, Digital Wallet, Cash), Online Sale (Card Payments, Digital Wallet)), and by End-user Industries (Retail, Entertainment, Healthcare, Hospitality). E-commerce payments include online purchases of goods and services such as purchases made on e-commerce websites and online booking of travel and accommodation. The scope of the market excludes online purchases of motor vehicles, real estate, utility bill payments (such as water, heating, and electricity), mortgage payments, loans, credit card bills, or purchases of shares and bonds. As for Point-of-Sale, all transactions that occur at the physical point of sale are included in the scope of the market. It includes traditional in-store transactions and all face-to-face transactions regardless of the location of the transaction. Cash is also considered for both cases (cash-on-delivery for e-commerce sales).

The study tracks key market metrics, underlying growth influencers, and significant industry vendors, providing support for Canada's market estimates and growth rates throughout the anticipated period. The study looks at COVID-19's overall influence on the Canadian payment ecosystem.