Mercator Examines Canadian Mobile Payments Market, Finds Growth
We all know there are plenty of options when it comes to the mobile payments sector. Start with the obvious mobile wallets and store-based systems, and spread out from there to the various cards that often make mobile wallets and store-based systems possible. Recently, the Mercator Advisory Group dropped word our way about its recent study of one branch of mobile payments: the Canadian open-loop prepaid market.
The Mercator study—titled “The Canadian Open-Loop Prepaid Market: 2018”—examined the overall condition of prepaid card issuers and ancillary markets therein. Mercator noted quickly that the Canadian prepaid card market is much different from its United States counterpart, particularly in the fact that it’s so much smaller. Despite the smaller size, however, it did find an exciting point: growth.
The entire prepaid market currently comprises 11 out of a possible 17 segments, which means there’s actually room for product line expansion. This means that future growth of some type is virtually guaranteed as the sector breaks into entirely new markets. It will take time and resources to properly establish a presence therein, of course, but there’s still plenty of room for expansion.
One of the biggest problems in the field is seen in the “Corporate-Funded Cards” prepaid category, as it requires specialized knowledge to engage in said market. This has kept the overall market size low, down to just $200 million Canadian. Meanwhile, the “Government-Funded Cards” category is new, but growing steadily, as the government takes advantage of cost savings stemming from offering prepaid cards as benefits payment rather than using paper checks.
The market as a whole, meanwhile, saw growth, hitting $4.3 billion Canadian, which represented an overall increase of nine percent over the same time last year.
The numbers are solid enough to be welcome, and the good news here is that there’s still plenty of room for the Canadian prepaid card market to see gains. If the corporate market can shore up its knowledge base, it will likely be able to expand over its comparatively tepid levels. With the government market still really just getting started, it’s likely growth will be seen there as well.
It’s a good time to be in Canadian prepaid cards, illustrating that the mobile payments market is a diverse place with room yet to grow.