The payments landscape has changed dramatically in the past few years, and that momentum is driving several payment trends for 2024. Ensure consumers' adoption and use of these payment methods are on your radar for 2024, and make informed decisions about whether it’s time to implement them to enhance checkout experiences for your customers.
Payment Trends for 2024
- Contactless Payments
Canadians have embraced contactless payments. Interac reports a 53% increase in mobile debit contactless payments from 2022 to 2023, crediting Gen Z consumers for influencing others to try and adopt this convenient payment method. Almost 80% of Gen Z consumers pay with mobile wallets on their smartphones, and 52% say they’ve taught older family members how to pay with their phones.
The Interac survey also asked Canadians about the future, and 63% say it will become normal in the not-too-distant future to leave home without a physical wallet, knowing they can pay with a smartphone or smartwatch.
Retailers must align with this trend – their customers may not have cash in their pockets or even a physical credit or debit card to complete a purchase. Accepting contactless payments is a must for maintaining revenues and customer loyalty.
Also, look for greater adoption of softPOS. This technology allows merchants to accept contactless payments directly on a smartphone or tablet. Fortune Business Insights predicts the global softPOS market, valued at CAD 337.33 million in 2022, will reach more than CAD 1.462 billion by 2030, a 20.4% compound annual growth rate (CAGR). Furthermore, KBV Research expects the Canadian softPOS market will outpace global growth with a predicted 21.9% CAGR.
Based on contactless payment stats, it’s easy to see consumers are increasingly choosing to pay with mobile wallets or, in some cases, contactless payment cards. However, merchants will also drive softPOS use. It lowers the barrier to entry to contactless payment acceptance by allowing merchants to use mobile devices, possibly some that they already own. There is no need to purchase and maintain payment terminals or PIN pads, lowering payment solutions' total cost of ownership (TCO). Retailers of all sizes should consider leveraging this technology to enhance customer experiences. Consumers will increasingly expect to use contactless payments anywhere – at the drive-thru, curbside, or a festival stand. Meet those expectations.
Person-to-person or peer-to-peer (P2P) payment grew in popularity during the pandemic. Interac reports since 2020, it has processed 1 billion eTransfer transactions totaling more than CAD 350 billion.
Many consumers now routinely use this service to reimburse a friend for their portion of a restaurant check, pay rent, and send monetary gifts to family and friends. However, Interac states 17% of Canadians now use eTransfer to make purchases at businesses.
Merchants should track their customers’ behaviors and feedback and consider adding this payment option if demand exists.
- Buy Now, Pay Later (BNPL)
Statista expects BNPL transaction value to rise about 20% from 2022 to 2023 in Canada. BNPL allows consumers to pay for large purchases in installments, the first due at the time of sale and the next two or three over the next few weeks.
Payments Canada reports consumers 18-34 are most likely to choose this payment method. The survey, Payments Behaviour Tracker – Payments Innovation, found these consumers see BNPL as a convenient tool that helps them budget. The survey also found, as of last year, about half of consumers across all demographics had not used BNPL.
As more consumers discover this option, particularly when prices have rapidly increased, retailers should consider giving them this option. Flexible payment technology will allow you to accept BNPL payments in-store and may help you capture more revenues from high-value item purchases.
- Biometric Payments
Biometric payments are an emerging payment trend to watch in 2024. This technology allows consumers to pay with a fingerprint, facial, or infrared palm vein scan. Once a consumer enrolls and links their payment account to their scan stored securely in the system, all they need to do to pay is authenticate their identity with a scan at the time of purchase. Using biometric data is not only convenient for the customer but also helps secure payments; it’s extremely difficult to use an account if not authorized to do so.
The Canadian Payment Methods and Trends Report found consumers would be more comfortable with biometric payments than some other options, like using QR codes or shopping with smart devices or virtual assistants. However, consumers’ primary concern with this payment method is the security of their biometric data.
Monitor the level of consumer comfort with this payment method in the coming months and stay on trend to accept this secure payment method.
Where to Learn More
As consumer behaviors and preferences continue to evolve and technology advances, you need partners you can trust to provide you with information on payment trends for 2024 and beyond. Ingenico keeps current with industry trends – and even drives some of them with our innovative solutions – and can provide you with the information you need to stay on the cutting edge of payments.
Contact us for information on how to provide the payment experiences your customers prefer.