A Snapshot of Canadian Retail Payments

Navigator Edition: October 2012
By: Frank Martien

In October 2012, the Canadian Payments Association released a comprehensive view of retail payments in Canada entitled “Examining Canadian Payment Methods and Trends.”  As portrayed in Figure 1, several trends can be observed:

  • Debit and credit card spend continue to grow at mid single-digit rates.  Importantly, reductions in average card transaction sizes have demonstrated that cards continue to displace cash.
  • Prepaid cards and e-wallets/P2P have been growing at over 40% per year and, on a combined basis, have reached dollar values totaling about one-third of debit and one-sixth of credit cards.
  • EFT and cheque dollar values exceed many other forms of retail payment – in many cases by a factor of 10x – with relative growth rates suggesting EFT is gradually displacing cheques.

Looking forward, we would expect to see cash and cheques continue to migrate towards electronic forms of payment.  Within electronic payments, duality may lead to greater card product variation and customer segmentation, which could boost growth in credit cards.  Meanwhile, prepaid, e-wallets, and P2P forms of payment are becoming significant enough in size and annual dollar spend growth to warrant more attention, particularly if certain types of e-wallets could meaningfully tap into EFT-related spend.  We anticipate that winners will include those financial institutions and service providers that develop integrated payments strategies to optimize customer experience, investments, and profits across forms of payment.

Figure 1: Value of Canadian Retail Payments for 2011

Source: October 2012, Canadian Payments Association “Examining Canadian Payment Methods and Trends.”
Note:  excludes wholesale LVTS payments and business cheques over $25 million.

For more information, please contact Frank Martien, Partner specializing in Commercial Payments,

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