Canadians aren’t so beholden to their debit cards as once was believed. In fact, debit isn’t their preferred form of payment in any of the eight merchant categories TSYS asked about in a recent consumer study, the results of which were released earlier today.
In a recent podcast interview, Joe Majestic, TSYS director of corporate strategy and research, said what he found most interesting in the research was the overall preferences respondents noted. Their preference for credit and debit card use was almost identical, at 34 percent and 33 percent respectively.
(jump to: 0:59) “Given the market dynamics in Canada, we expected to see debit preferred over credit by some margin,” Majestic said. “In addition, cash was preferred by 19% of consumers, and that was surprising, particularly given the fact that, in order to participate in this study, you had to have both a credit card and a debit card."
Majestic couldn’t explain specifically why Canadians were still interested in using cash. One possibility could be where Canadians tend to shop.
(jump to: 2:20) “Credit was preferred at five of the eight merchant categories we asked about, and that included supermarkets, gas stations, online retailers, dine-in restaurants and departments stores,” Majestic said. “Cash was the preferred payment method at discount stores, coffee shops and fast food restaurants. Debit cards were not preferred at any of the locations, but was second in most."
Asked to rank the features that motivate them to pick a certain payment form over another, respondents cited cash back and discounts highest, followed by the ability to use loyalty points to discount the purchase at the point of sale, Majestic said. Rewards and special offers also drove consumers’ interest in using merchant-issued cards, he added.
TSYS conducted the research because it has a variety of client s in Canada, and it wanted to provide them with consumer data that could help them formulate strategy and tactics. For more information about the study “TSYS 2014 Canadian Consumer Payment Preference Study,” click here.
To hear more from Majestic about trends the research found in Canadian consumers’ payment habits, listen to the full podcast by clicking below.
Joe Majestic, Director of Corporate Strategy and Research, TSYS
Joe is a 30-year veteran of the financial services and payments industry, having held senior positions in market research, product management, operations and technology for several large banks. He has also worked for several management consulting and market research firms supporting banking and financial services firms throughout the world.