Canada: an analysis of payments and ecommerce trends

From ecommerce to generative AI (GenAI), technology plays a key role in providing choice in payments. In Canada, 21.7 billion retail payment transactions were made in 2023, totalling CAD 11.9 trillion. In analysing these transactions, Payments Canada’s latest Canadian Payment Methods and Trends report sheds light on how payment innovations have evolved purchasing behaviours and preferences in ecommerce. The report also explores emerging trends in international payments and technologies, including GenAI, wearables, and social media-based payments. 

Ecommerce payment trends in Canada 

Ecommerce payments in Canada accounted for 546 million transactions worth CAD 71.6 billion in 2023, up 3% in both volume and value year-over-year. Canadians made an average of 4.1 purchases (up from 3.6 the year prior) and spent CAD 213 online in a given month (down from CAD 217 the year prior). The top categories of online purchases included clothing, restaurants/fast food, groceries, electronics, and personal beauty products. 

Diving further into ecommerce, the report shows that the majority of online purchases were made via ecommerce websites. 63% of consumers who made an online purchase in a given month did so using their computer, laptop, or mobile device to access online merchant web pages. One in four Canadians made an in-app online purchase in a given month, while 8% of Canadians made online purchases through a gaming console (e.g., PlayStation 4, Xbox One) in a given month. 

Significantly more Canadians perceived buying online from a Canadian merchant to be easier compared to buying online from an international merchant. 90% of consumers rated their experience purchasing from a Canadian retail business website as easy, while 67% rated purchasing from an international website as easy. Over half of all consumers (56%) were satisfied with the time it took to execute the payment when making it through a website or payment app. 

Beyond ecommerce: emerging payment trends and technology 

Around one in two businesses (49%) intended to use GenAI to make their operations and processes more efficient. The top three GenAI applications perceived to benefit businesses most are fraud detection and prevention (44%), automating payment processing (37%), and creating personalised customer experiences (29%). Personalised experiences facilitated by GenAI can include personal retail assistants and 24/7 chatbot support that includes carrying on customer conversations. 

Wearables, such as fitness trackers and smartwatches, were used to initiate 44 million payment transactions. Wearable transactions totalled CAD 1.1 billion in 2023. Although this represented less than 1% of total contactless transaction volume and value in 2023, wearables usage for payment increased by 32% in volume and 34% in value from 2022. 

Credit card contactless (includes tap-to-pay by card or mobile device) made up the largest proportion of contactless transaction volume at 57%. In-store mobile contactless payments increased by 42%, representing 23% of total contactless transaction volume. 

More than one in ten Canadians used smart home devices and social media to make purchases. 13% of Canadians used smart devices or social media to place an online order or initiate a payment in a given month in 2023. Top smart devices and social media used for purchasing included Amazon Alexa, Google Home, Instagram, Facebook, and Apple Siri. 

Cross-border payments 

The research also shows that international payments are on the rise in Canada. The proportion of Canadians who sent money internationally increased by 33% from 2022 to 2023, as one in five Canadians did so at least once over a 12-month period. The average value of payments sent to individuals internationally in a given month in 2023 was CAD 1,125 – compared to CAD 1,231 sent to businesses internationally. Extra or hidden fees (26%) and the high cost of each transaction (23%) were cited as the biggest pain points for sending money internationally. 

Overall, Canadians still prefer using their main bank or credit union for sending money internationally. Almost one third of Canadians (31%) who sent money internationally in the last twelve months used an electronic transfer via their mobile banking app or online banking account, while 11% of Canadians used wire transfers. 

Regulatory environment 

Evolving regulations and industry policies will enable new ways to securely pay for goods and services, transfer money, and better compete nationally and internationally. This includes changes to the Canadian Payments Act (CP Act), which sets Payments Canada’s mandate, public policy objectives, and membership eligibility. Amendments to the CP Act received Royal Assent in 2024. 

After coming into force, these amendments will foster competition and innovation through expanded membership eligibility and access to Payments Canada’s payment infrastructure, including the forthcoming Real-Time Rail (RTR). Membership will be expanded to include: 

• payment service providers (PSPs) as defined in the Retail Payment Activities Act (RPAA) that perform retail payment activities, 

• credit union locals that are members of a central, 

• clearing houses of designated clearing and settlement systems. 

Coming together to shape the future of payments 

As payment technologies continue to advance, so too will the ways Canadians choose to pay and send or receive money. From AI-powered personalisation to wearables and social commerce, the future of payments is already taking shape – and evolving fast. 

Canada is entering a new era of inclusivity and competition in the payment space. With a growing appetite for frictionless, secure, and personalised transactions, the future of payments in Canada will be defined by collaboration among regulators, financial institutions, technology providers, and end-users. Together, these forces are shaping a transformative payment landscape, where innovation and user-centric solutions will drive sustained growth and global competitiveness. 

To learn more about payment trends in Canada, including the upcoming 2025 Canadian Payment Methods and Trends report which will be released this fall, please visit payments.ca. 

 

About Stephen Yun 

Stephen's areas of focus include the Canadian Payment Methods and Trends report and Payment Behaviour Tracking studies. He leverages research insights to create a consumer/business payment narrative and drive business action for his business partners. Stephen has more than 20 years of experience leading marketing and customer experience research. He holds MBA and BBA degrees from the Schulich School of Business (York University) specialising in marketing and finance. 

 

About Payments Canada 

Payments Canada makes payments easier, smarter, and safer for Canadians by providing secure and resilient infrastructure for clearing and settling payments between financial institutions. As a public-purpose organisation, we own and operate Canada's national payment systems: Lynx, the Automated Clearing Settlement System (ACSS), and the upcoming Real-Time Rail (RTR). We also develop the bylaws, rules, and standards that support these systems. In 2024, our systems cleared and settled CAD 107 trillion – over CAD 424 billion every business day.