Canada's payment processes are continuing to evolve, reflecting shifting consumer preferences and technological advancements. With an increasing number of Canadians engaging in online transactions, it’s essential for merchants to explore the most popular online payment methods available.
For example, most Canadians prefer using a credit card, Interac debit or cryptocurrencies to fund their iGaming accounts. Sergio Zammit from Techopedia explains that most online casinos offer players a diverse range of payment methods driven by consumer demand, allowing players to access the best online slots in CA, live dealer games and more. The chosen payment method usually comes down to the player’s preferences. The same is applied to in-store and online store purchases, with merchants offering varying options to consumers.
Credits and debit cards
Credit cards remain the most popular payment method in Canada, accounting for a significant portion of both in-store and online transactions.
According to recent data, credit cards equate to 33% of the total payment volume in the country. Canada has about 22.4 million credit card holders, with at least 69% of Canadians using credit cards for essential expenses like utilities and groceries.
Additionally, debit cards are the second most common payment, accounting for 30% of the nation’s payment volume. Offering a direct link to consumers’ bank accounts, Canada’s Interac network facilitates most debit transactions and has become an integral part of the country’s payment infrastructure.
Contactless mobile payments
Mobile payments are gaining significant traction in Canada through major platforms like Apple Pay, Google Pay and Samsung Pay. In 2023, mobile contactless payments increased by 42% and now make up 23% of all contactless payments in the country. According to the same report, at least 44 million transactions were made using wearables in 2023, worth approximately $1.1 billion.
Grocery stores and supermarkets are the leading industries in Canada that accept contactless payments, followed by pharmacies and gas stations. The factors driving the growth of mobile payments include:
- Widespread availability:
Almost all debit and credit cards are now contactless-enabled.
- High merchant adoption:
Contactless terminal penetration is extremely high among merchants in Canada.
- Increased payment limit:
During the pandemic, contactless payment limits were increased to $250, allowing for higher-value entry without requiring users to enter their PINs.
Contactless wearable payments
While contactless payments are used more frequently, mobile and wearable payments are gaining traction. Mobile transactions grew by 42% in the last year, which accounts for 23% of all contactless payments.
Nearly 30 million smartphones in the country are NFC-enabled, allowing users to use the tap-to-pay feature for transactions. Despite being in the early stages of development, wearable payments are expected to grow by 2025.
The adoption of contactless and mobile payments is driven by consumer behavior, with 36% of Canadians trying to stay below the maximum contactless payment limit when making a purchase in-store. This specific payment method does have its fair share of skepticism, with approximately 24% of Canadians saying they do not trust contactless/mobile payments due to security concerns.
Digital wallets
Digital wallets are becoming increasingly popular for both online and in-store purchases. Additionally, most iGaming and e-commerce platforms and online marketplaces accept digital wallet payments.
E-wallets like PayPal remain the most widely used wallet in the country. At least 86% of the total payment volume in Canada now comes from e-wallets.
Some of the key factors driving digital wallet adoption include the convenience and speed of these transactions. As well, this adoption is driven by younger consumers who are integrating digital wallets with smartphones and wearables.
Interac
Interac is a Canadian interbank network that offers several payment solutions, including Interac debit, e-Transfer, Flash and Online. It’s the country’s national debit card system and predominant transfer network. Interac links to over 300 financial institutions and other businesses for electronic financial transactions.
This service allows Canadians to send money directly from their bank account to another individual or business using an email address or mobile phone number. Several offshore casinos accept Interac as a payment form for deposits and withdrawals, offering convenience and security in one go.
Cash
Despite the growing prevalence of digital payment methods, cash payments continue to play a massive role in Canada, with cash now representing 33% of the total payment volume. Many Canadians view cash as a reliable, widely accepted and secure backup payment option.
In 2023, 49% of Canadians reported frequent cash use in 2023, with cash transaction volume increasing by 15%. However, cash transactions are projected to drop by 70% by 2030. This decline is part of a broader trend toward a cashless society.
Prepaid cards
Prepaid cards are carving out a significant niche in the Canadian payment landscape. These cards offer an alternative for those with limited access to traditional banking services. As such, many Canadians use prepaid cards as a budgeting tool to control spending. The prepaid card market is also boosted by the popularity of gift cards for both personal and corporate use. Plus, many prepaid cards can now be added to digital wallets, further increasing their convenience and usage.
This payment method has shown the greatest growth in transaction value among card types at 10% year-over-year. In 2024, the average prepaid transaction value was $69 and the total prepaid card transaction value reached $24 billion, up from $19.3 billion in 2019
The future of payment options
Although credit and debit cards are still widely used in transactions, the increasing popularity of digital wallets signifies a trend toward more flexible payment options. Interac continues to be a payment leader in the country, offering a secure means of transferring funds. Even with the growing preference for cashless transactions, cash still retains its importance in spending.
This range of payment options to cater to consumers preferences enriches the shopping and gaming endeavours of Canadians from coast to coast.
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