Canadians Abandoning Cash for Cards
Canadians now use cash for less than half of their retail purchases, according to a study released by the Bank of Canada.
The number of cash transactions dipped from 53.5% of transactions in 2009 to 43.9% in 2013, the central bank found. However the value of transactions made in cash remained almost unchanged, at 23% of all the goods and services sold.
The Bank of Canada attributed the decline of cash transactions to the increasing popularity of contactless credit and payment cards, with even minor transactions that were once exclusively cash such as paying for parking, entertainment and food increasingly done by credit card.
Consumers aged 55 and above were more likely to use cash, but even they do less than half their transactions using this traditional method.
As a result, the number of automated teller machine (ATM) transactions has fallen. The bank found that in 2009, Canadians visited an ATM about 4.4 times a month on average, but by 2013 this figure was 2.7 times.
Meanwhile, credit card use has risen to account for 31% of transactions, an increase of 11 percentage points from five years ago.
Mobile payment systems are expected to make inroads in Canada over the next few years, but currently represent only 7% of retail payments. Mobile payments are most popular with 18 to 34 year-olds, who pay by cellphone for 16% of transactions.
The bank also asked Canadians how much cash they have in their wallet, with the average figure C$84.