Pay-by-bank payment methods appeal to less than one-third of Canadians, except among newcomers to the country. This trend reflects a broader pattern where pay-by-bank has gained popularity worldwide—yet remains less prevalent in North America.
Data from Payments Canada found that only 29% of Canadians find pay-by-bank appealing, while 33% do not. The only demographic where more than half (53%) of respondents showed interest was newcomers to Canada.
Pay-by-bank allows consumers to make purchases directly from their bank account without manually entering account and routing numbers. However, in the U.S., credit and debit cards have long been the preferred payment methods for both online and in-store purchases.
In contrast, pay-by-bank adoption has been strong across many European markets. It ranks among the top three payment methods in the UK, Netherlands, Finland, Spain, and Germany. Visa is set to launch an account-to-account pay-by-bank service in the UK and Europe this year but has yet to announce any plans for North America.
Generational Gaps
There’s a notable generational divide in the adoption of pay-by-bank services. Payments Canada found that while 34% of younger Canadians are drawn to the service, that figure drops to 22% among older Canadians. Similarly, separate research from MX, which explored pay-by-bank usage in Europe, found that younger demographics were more likely to adopt the method. More than one-third of respondents ages 18 to 29 reported using pay-by-bank daily or weekly, compared to just 25% across all age groups.
Much of this reluctance may stem from habit. The MX study found that 78% of consumers prefer to stick with familiar payment methods. A majority of baby boomers said they would never use pay-by-bank, compared to an average of just 28% across all other generations.
Another key barrier to adoption is the lack of incentives, such as cashback offers or rewards points. Payments Canada found that 60% of Canadians would be more likely to use pay-by-bank if such perks were available.
“Consumers like using cards, especially rewards credit cards,” said Elisa Tavilla, Director of Debit Payments at Javelin Strategy & Research. “There’s also the purchase protection that comes with cards. if you order something and it doesn’t get delivered, you’re protected. That same level of protection doesn’t currently exist with pay-by-bank transactions.”
