The number of payment cards in circulation in Canada increased at a CAGR of 6.1% during the period 2012-2014. The growth of cards in circulation during the period can be attributed to expansion of ATMs and POS terminals, growing disposable income and greater acceptance of payment cards in the country.
The consumer preference for cashless payments further supports the growth of card payments in the country. Banks have implemented different pricing and marketing strategies to encourage consumers to increase card payments rather than paying in cash. Common strategies used by banks and card issuers are product discounts and reward points.
The Canadian payment card market is dominated by the credit card segment, in terms of number of cards in circulation. Credit cards are being used by consumers to shop at retail outlets and make online payments. The credit card market is expected to grow over the forecast period at a CAGR of 1.6%. MasterCard was the leading scheme in the credit card market in 2014. The credit cards in the country were primarily used at POS terminals for retail purchases, rather than for cash withdrawals at ATMs. The frequency of credit card use witnessed a CAGR of 1% during 2012-2014. The credit card market witnessed intense competition among credit card issuers, to encourage card usage and spend. The card issuing banks implemented various marketing strategies and offered numerous campaigns to attract consumers. The key players in the credit card market include Royal Bank of Canada, TD Canada Trust, Canadian Imperial Bank of Commerce and Bank of Montreal.
In the debit card segment, RBC was the leading card issuer in terms of the number of cards in circulation, in 2014. Debit card frequency of use increased from 194 in 2012 to 202 in 2014, at a CAGR of 2.1%. Some of the key players in the debit card market include Royal Bank of Canada, TD Canada Trust, Canadian Imperial Bank of Commerce and Bank of Montreal.
The charge cards segment represents a small portion of the Canadian pay later card market. Average charge card transaction value declined from CAD 121.4 in 2012 to CAD 117.7 in 2014, at a CAGR of -1.5%. The average charge card transaction value is further expected to decline during the forecast period.
News Courtesy: P&S Market Research