Contactless payments soared to 4.1 billion in Canada in 2018, surging 97.2% compared to 2016, according to a report from Payments Canada.
The northern American country also witnessed almost $129.9 billion in contactless transaction value in 2018, recording a 93.5% increase from its value two years prior. Contactless payments have seen a sudden surge in Canada, especially considering that only 215 million transactions were recorded in 2012, amounting to a total of less than $9.7 billion.
Contactless transactions have been a major part of Canada’s payment ecosystem. In 2018, contactless payments were responsible for 19.5% of the country’s 21.1 billion transactions, almost in line with the 21% cash share. Contactless payments’ share of Canada’s $9.9 trillion in transaction value was quite low in comparison at just 1.3%, but their increased level of volume still makes them a crucial aspect of the country’s payment landscape.
Mobile payments have already been established as a popular channel for contactless payments in Canada, but financial institutions may now be using them to attract more volume.
Nearly 35% of consumers in Canada used their mobile device to conduct contactless transactions last year, but security concerns are on the rise. Having over one-third of consumers use mobile phones for contactless payments is a good start, but the report states that its use has been less frequent than that of contactless cards.
The difference is probably due to consumers having growing concerns about the security of mobile payments, as less than one-third believe mobile payments are safe and secure, according to statistics disclosed in the report. This is similar to U.S. consumers being wary about the safety of mobile wallets.
Financial institutions are consumers’ most reliable source for mobile payments, so their best stance would be to make the use of contactless payments via mobile devices more popular. Almost half (48%) of Canadian consumers said their own financial institution or bank was the most trusted source for mobile payments – a stretch from the 7% who opted for payment networks or the 5% who chose mobile device manufacturers, according to a report from TSYS.
This means that financial institutions in Canada will be successful in promoting their own mobile payments systems, rather than collaborating with third-party wallets, which would help them attract more volume and exploit Canadian consumers’ fascination towards contactless payments.