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Canadian Commercial Credit Card Spend in 2020:

PaymentsJournal by PaymentsJournal
October 22, 2021
in Commercial Finance, Corporate Banking, Credit, Truth In Data
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Don’t miss another episode of Truth In Data! Click on the red bell in the lower-left of your screen to receive notifications as soon as the episode publishes.

Data for today’s episode is provided by Mercator Advisory Group’s Report: Commercial Credit Cards: North America Market Review and Forecast, 2019-2025

Canadian Commercial Credit Card Spend in 2020:

  • Overall 2020 commercial credit card spending in Canada was $27.8 billion (USD).
  • This is 39.3% lower than commercial credit card spend in 2019.
  • Corporate card spending declined by 70%, largely driving the overall commercial card decline. 
  • Purchasing card spending saw a less severe 8.9% drop to $18.5 billion (USD).
  • Mercator anticipates a modest 19% improvement in 2021, with a relatively slow business travel trajectory due to Canada’s strict lockdown policies.
  • Mercator anticipates a CAGR of 14.3% for Canadian commercial card spend in the 2021-2025 timeframe.  

About Report

Prior to the onset of the pandemic, the commercial credit card market for mid to large corporates in North America had been in a reasonably strong growth mode for several years, with a similar trajectory expected going forward in the following few years. As COVID-related lockdown policies were generally instituted in all regions, with accompanying restrictions on inbound international travel, the challenge was figuring out just how badly corporate card spend would be impacted and the scope of spillover effects on other payments from business slowdowns. As it turned out, the overall U.S. full-year GDP decline was relatively mild and as of Q1 2021, output had exceeded $22 trillion, suggesting a relatively fast, V-curve recovery. Accelerated digital payments adoption by corporates saddled by work-from-home scenarios and industry concentration on purchasing cards and non-travel virtual cards helped to ameliorate disastrous overall card payment declines. Mercator Advisory Group’s latest research report, Commercial Credit Cards: North America Market Review and Forecast, 2019-2025 provides a review of the commercial credit card markets in Canada and the United States, including an analysis of how the pandemic impacted 2020 spend, as well as recovery expectations through 2025.

“The good news for the industry in North America, especially the United States, is that the movement towards expanded use cases for cards in accounts payable created a substantial offsetting balance to the negative effects of lost travel spend,” commented Steve Murphy, Director, Commercial and Enterprise Payments Advisory Service, author of the report, “and this shift has occurred over time, setting the industry up for returned growth during the coming five years.”

Tags: Canadacommercial cardsCommercial financeCommercial PaymentsCorporate Cardspurchasing cardtravelTruth In Data
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