Market Trends of Canada Payment Gateway Industry
Increased Demand for Mobile-based Payments
- Canadian consumers increasingly turn to mobile wallets and contactless payment methods, including Apple Pay, Google Pay, and Samsung Pay. As a result, businesses are now integrating these mobile payment options into their platforms. Payment gateways that facilitate mobile transactions provide users with convenience and ensure security, leading to widespread adoption, especially in sectors like e-commerce and retail.
- Mobile phones have emerged as key players in the realm of innovative payment technologies, particularly mobile payments. In Canada, smartphone ownership is notably high. Statistics Canada highlights that 84% of Canadians aged 15 and older use smartphones for personal purposes. Furthermore, mobile network accessibility spans across the nation, with nearly all Canadians, whether in urban or rural settings, able to connect, thereby bolstering the mobile payments trend.
- In Canada, the rising popularity of mobile e-commerce (m-commerce) is significantly fueling the demand for mobile-based payment solutions. With an increasing number of consumers turning to mobile apps and websites for their purchases, there's a pressing need for payment gateways to deliver secure and intuitive mobile payment processing. Consequently, this trend elevates the demand for payment gateways that ensure a seamless and secure mobile experience.
- In September 2024, SecondShop unveiled its e-commerce platform, focusing on offering premium, nearly-new home goods at substantial discounts. To bolster this venture, SecondShop garnered CAD 2 million (USD 1.47 million) in seed funding, spearheaded by Harvest Venture Partners and joined by prominent angel investors in the industry.
- As of Q2 2023, Canada boasted approximately 35.6 million mobile phone subscriptions, a rise from the 33.2 million recorded in the prior quarter, as reported by the CRTC - Canadian Radio-television and Telecommunications Commission. Most of these subscriptions encompassed both voice and data services.
Understand The Key Trends Shaping This Market
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Retail is expected to hold a major share
- In Canada, the retail industry has witnessed a swift surge in online shopping as consumers turn to digital platforms for their purchases. This shift has notably heightened the demand for payment gateways, especially those adept at managing high transaction volumes and supporting mobile payments and card processing.
- Retailers are adopting mobile payment solutions such as Apple Pay and Google Pay, catering to consumers' preferences for convenience. Consequently, payment gateways that facilitate seamless mobile transactions have become indispensable for the retail sector.
- In July 2024, US-based BNPL provider Affirm partnered with Canada-based retail company RONA to offer flexible online payment options to RONA's Canadian customers. Through this collaboration, RONA customers approved for the service can choose Affirm at checkout on rona.ca, allowing them to divide eligible purchases into biweekly or monthly payments over terms of up to 12 months. Customers see the total purchase cost upfront and can rest assured they won't incur any additional charges, as Affirm does not impose late or hidden fees.
- With the rise of omnichannel sales models, where retail businesses seamlessly blend physical stores with online platforms, there's an increasing demand for adaptable payment gateway solutions catering to diverse sales channels.
- As of June 2023, StatCan, the agency of the Government of Canada, reported that Canada had roughly 52,500 micro-retail trade establishments, with each employing between one and four individuals. In stark contrast, the entire nation boasted a mere 60 retail establishments that employed 500 or more people.
