Cash and other paper transactions, such as cheques, are still dominating the Canadian payment system, according to a report released by the Payments Canada that operates a payment clearing and settlement system in the country.
Titled ‘The Canadian Payment Methods and Trends (CPMT)’, the report highlighted the changing payment behaviours of Canadian consumers and businesses and pointed out that new payment channels are growing with substantial pace.
These trends underpins the requirement for Canada to adapt its payment systems as the global payments ecosystem changes, which is what Payments Canada is doing with its “Modernisation” drive.
As per the CPMT research, which focuses on trends between 2008 and 2015, the payments market in Canada grew to 20.9 billion transactions, worth more than CAD8.9 trillion ($6.6 trillion), in 2015.
Due to increasing consumers’ demands for speed, convenience and rewards, many of these trends are being driven at merchant locations, including credit card, contactless and e-commerce.
According to the report, contactless payments increased by 70% in both volume and value of transactions in 2015.
Cash continues to account for the most transaction volume; however, cash use has witnessed a downward trend. Since 2011, cash use has decreased by 20%.
Online transfers are the fastest growing, and has touched to an estimated 120 million transactions worth CAD45bn ($33.4bn) in 2015.
Since 2011, the use of cheques has decreased by 25% and continues to decrease, but the value has been buoyed by continuing use by Canadian commercial enterprises, growing by more than 2% on average each year.
Payments Canada chief risk officer and vice-president of risk, security and research Carol Ann Northcott said: “The Canadian Payment Methods and Trends report is an important window into the future of payments technology in Canada.
“While paper-based payment methods continue to decline, emerging technology is shaping the Canadian payment landscape of the future."