Digital Payments Represented 86% of Total Payment Volume across Canada in 2024: Why the Surge?

For the digital payment industry, 2024 was a remarkable year in Canada. According to Payments Canada, who underpin the country’s financial system and economy by owning and operate the payment clearing and settlement infrastructure, digital payments represented 86% of payment volume in the country in 2024. The market had grown by 3% in both volume and value. Below is a look at what drove such a high percentage of digital payments in 2024, at the modernity of Canadian consumers’ preferences, and the challenges and benefits this surge has created.

Driving forces behind digital payments

Digital payment in Canada largely consists of credit cards and points of sale (POS), and Canadians have shown a very clear preference for credit cards. Together with debit cards (30%), credit cards (33%) made up 63% of payment volume, according to Payment Canada. When it comes to paying for goods and service online, data on the website of consumer and market data company Statista shows credit cards are still the most popular method of payment, although digital wallets ate into their share of the market in 2024.

Making life easy for consumers

Consumers’ demand for payment methods that make life easier for them, combined with technological innovation, has fostered the swing towards digital payments. Contactless payment is more mainstream, and mobile wallets have transcended early adoption. Thirteen billion payments were contactless, up 11% from 2023, and more than half of all transactions were contactless. Mobile contactless payments in 2024 grew by 28%, having increased to 3.4 billion, and are predicted to climb to 5.7 billion by 2028, which will represent a 66% increase.

Businesses that are capitalizing on this

One type of business that understands Canadian consumers’ desire to make and receive payments as quickly and easily as possible is iGaming. Online casinos in Canada have realized that offering a variety of verified payment methods not only minimizes fuss for players who wish to credit their accounts or withdraw winnings, but it also builds trust with them. If players can access their winnings sooner, the casino appears more trustworthy, so Casino.org ranks the best instant payout casinos and reviews different online casinos so that consumers can find the safest websites to play at.

Is Canada becoming more modern in terms of payment methods?

The payment volume findings in the report suggest Canadians are adopting an open mind, but that they’re also clinging onto cash. Cash accounted for 2.5 billion transactions, which represented 11% of payment volume, and more than half of Canadians stated they didn’t want to go completely cashless. Forty-eight per cent of Canadians still used cash regularly in 2024, averaging 3.5 times a week.

Nevertheless, the findings on contactless payments and other digital payments are encouraging. The organization discovered more than two-thirds of Canadians made purchases via smartphone in a six-month period. Online transfers have overtaken payments by cheque in business transactions for the first time as well. Their volume and value grew by 14 and 20% respectively, and this includes options such as Interac, e-Transfer, and PayPal.

There’s also interest in artificial intelligence (AI)-enhanced shopping experiences. AI agents that can search for goods, compare, and complete purchases for the shopper appeal to 28% of Canadians. Purchases on social media livestreams are also of interest to one in five Canadian consumers.

The challenges and benefits of the surge

The report will be of massive interest to fintech companies, who will see the interest in digital payments as making the Canadian market ripe for their products and services. AI companies, especially GenAI ones, will also be exploring the opportunities to bring their services to Canadians and aid consumers with product recommendations, chatbots, or other innovations to improve their shopping experience. The AI also has the potential to reinforce security and tackle fraud by detecting unusual transactions and odd transaction patterns.

And it would seem security is a concern for consumers, naturally. Although social media commerce is of interest to a lot of consumers because they can buy and sell products through the app without leaving it, security concerns put a lot off, too.

This is reflected in the motivation of Canadians who use the pay-by-bank option to pay businesses. Good security is this method’s key attraction and removes the need for customers to provide credit card details or debt ones directly on merchant sites. Instead, they’re redirected to their online banking account or mobile one and confirm go-ahead from there for the purchase.

Canada is an exciting market for any business, whether operating in the payments industry or outside of it. Anyone who can offer payment methods that combine convenience with robust security for consumers could really see their business thrive. The fact that many Canadians still use cash, however, means the more options a business can offer, the better to retain customers.