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Pulished Date February, 2020
ID: 7503
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Credit Cards Dominate The Canada Cards And Payments Market

Pulished: February, 2020
ID: 7503
Pages: 85

According to the report "Canada Cards And Payments Market - By Cards (Debit Cards, Credit Cards, Prepaid Cards), By Payment Terminals (POS And ATM's), By Payment Instruments (Credit Transfers, Direct Debit, Cheques And Payment Cards) - Transaction Value, Volumes, Historical Trends, Analysis And Forecasts (2017 -2021)" Published by Market Data Forecast, In terms of the number of cards in circulation, the segment of credit cards has dominated the Canada Cards and Payments Market. This was owing to the increasing acceptance, the rise in the availability of credit, awareness of brands, and reward programs. The main use of debit cards by customers in the matters relating to retail, ATM withdrawals, and also for making online payments. Prepaid cards have been widely employed by the government for spending related to welfare, and charge cards at the corporate level are majorly used for purchasing purposes owing to their fixed payment timeline.

Shift from credit to debit and prepaid cards

The economic slowdown and the financial crisis has altered the perspective of the middle class of the country regarding the use of credit cards. The slowdown has forced both the private and public organizations to increase their focus on the efficient working as well as bring about a reduction in costs. The government, as well as corporate entities, are also encouraging the use of prepaid cards when it comes to payments relating to welfare and for payments of employees.

Market dynamics being transformed by m-commerce

There has been rapid growth in the m-commerce segment of Canada which is acting as a booster for the growth of the overall market of e-commerce. The increasing sales of smartphones are also a major factor encouraging the growth of this segment.

Specific targeting of consumer segments

Cards issuers and banks are increasingly focusing on the specific targeting of distinct segments of customers by launching innovative customized products. The major banks such as RBC, BMO, and CIBC are offering specific cards for corporate and retail segments of customers. The younger population segment is also being targeted by a lot of banks, with cards being specifically designed for students.

The increase in the number of business tourists and leisure tourists has also led to the creation of new business opportunities for providers of travel cards, and many major banks and issuers are capitalizing on the same by issuing travel cards which specifically target this segment, the TD First Class Travel Visa Infinite Card is one such example, launched by the TD Canada Trust.

The segment of the high-income populace is also being targeted by banks, wherein customers have an inherent aversion to the use of cash, and readily use card payments involving prepaid, debit, and credit cards. The HSBC Premier MasterCard, RBC Royal Bank Visa Platinum and TD Platinum Travel Visa Card are a few examples of cards issued targeting this segment of customers.

The rise in the use of NFC

A growing number of telecoms and banks in Canada are launching payment platforms enabled with the NFC technology for smartphones. CIBC, in collaboration with Rogers Communications, launched a joint mobile payment platform back in 2012, where cardholders are allowed for paying for small ticket items via their mobiles at participating retail outlets.

The cardholders of Visa have also been allowed to make payments using the contactless technology by using their smartphones. The Visa payWave is an application which is installed on a smart device, which then interacts with the payment gateway of the bank for making a transaction at the contactless terminal of the merchant. The PayPass technology of MasterCard is a similar platform which enables cardholders to pay via mobile phones. The rapid growth in the adoption of NFC technology is expected to substantially aid the growth of the Canada Cards and Payments Market.

The rise in the number of installed POS terminals for encouraging card transactions

The rise in the acceptability of credit and debit cards at retail outlets, amalgamated with the shift of consumers towards using debit cards for purchases, has consequently led to an increase in the transaction volume at POS terminals. The ATM transactions are projected to decrease owing to the shift of consumers away from the conventional cash-based payments. The benefits of cash back, rewards, and discounts are also attracting customers to use cards instead of cash at POS terminals.

Royal Bank of Canada, TD Canada Trust, Canadian Imperial Bank of Commerce, Bank of Montreal and Desjardins are some of the leading companies in the Canada Cards and Payments Market.

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Canada Cards and Payments Market

Canada Cards and Payments Market

Canada Cards and Payments Market

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