The use of credit cards has been on the rise in the 21st century, and one of the primary reasons is the convenience behind them. More and more people use them as a payment method every day due to their practicality and efficiency. This article presents you with many absorbing credit card statistics and interesting facts regarding credit card history and current trends.
Top 10 Fun Facts About Credit Cards
- Credit cards were created in 1950.
- Up to 30% of debit cardholders use their smartphone to make payments.
- 13% of all credit card transactions are related to paying bills.
- The COVID-19 crisis has affected banks and credit card interest rates.
- Clothing and footwear top the list of products Canadians buy online.
- For many Canadians, having a card with rewards is essential.
- The average credit card debt in Canada is around $2000.
- 69% of Canadians had one debit card in 2018.
- The total financial loss due to credit card fraud is in the millions.
- There’s been a decrease in cash and ABM volume since 2012.
Credit Card Facts
1. Credit cards were created in 1950.
Here are some historical facts about credit cards. The founders of the Diners Club (Ralph Schneider and Frank McNamara) invented the modern credit card. This card required that users pay each month’s statement balance in full. It was only later that companies like American Express allowed customers to carry a balance on their cards.
2. Canadians reported a rise in annual fees on their credit cards.
Credit card statistics for Canada show that there was a significant rise in credit card annual fees in the period between 2013 and 2017. Namely, in 2013, about 21% of credit card owners had to pay a yearly fee. Four years later, this number grew to 37%.
3. Contactless payments have become increasingly popular in recent years.
Both card and mobile contactless payments have grown in popularity in the past few years. In 2019, there were as many as 4.7 billion contactless payments worth $156 billion in Canada. The increase in contactless payments coincided with people starting to use devices with NFC (Near Field Communication) capabilities. Credit card trends indicate that about 56% of Canadians tap their physical cards when shopping. Interestingly, people with higher income and younger individuals (18–34) are more likely to use tap to make payments.
4. 30% of debit cardholders use their smartphone to make payments.
Similarly, according to credit card usage statistics, 37% of credit cardholders use their phones to make purchases. Paying through the phone has been slowly increasing in popularity, and the trend is likely to continue. However, the potential lack of security is still the main reason why Canadians (about a quarter of them) stay away from paying with smartphones.
5. Statistics on credit card ownership by country show that Canada ranks high on the list of countries with the most credit cards.
Credit card usage statistics by country showed some interesting results. According to a 2017 survey examining how many people aged 15 or more owned credit cards, Canada ranked first with 82.58%. Israel came second with a score of 75.02%, while Norway landed third with 70.50% of the population of that age owning credit cards. The last on the list was Turkmenistan with 0%. The survey included 142 countries.
Credit Card Statistics for Canada
Credit cards practically overtook the market in the past decade and are now significantly affecting the use of cash. Read on to learn more about how many cards there are in Canada today and how credit cards threaten the existence of cash.
6. A whopping 81 million credit cards were issued in 2013 in Canada.
Credit card volume statistics demonstrate that the number of credit cards in Canada has seen a steady increase from 2000 to 2011. In 2012, there was a slight drop in numbers before the peak in 2013. The numbers from 2016 come close to the 2013 record, with around 80.6 million credit cards issued.
7. There has been a decrease in cash and ABM volumes since 2012.
Credit card stats for Canada indicate that there has been a 19% decrease in cash and ABM (Automated Banking Machines) volumes from 2012 to 2017. This is not surprising since the digitization of payments started in 2014. The Methods of Payment report by the Bank of Canada from 2017 shows the amount of cash is decreasing, and we are slowly turning into a cashless society.
8. Cheque and paper volumes have also been decreasing since 2012.
The emergence of digitized payments also affected the cheque and paper volumes. Namely, these two categories saw a decrease of 28% between 2012 and 2017. This decrease was concurrent with the 33% increase in both credit and debit volume.
9. 13% of all credit card transactions are used for paying bills.
Canadians usually use credit cards in POS environments. However, according to credit card usage statistics, a certain percentage of people also use their credit cards to take care of bills. These bills include categories like insurance, memberships, subscriptions, and utilities.
10. 69% of Canadians owned one debit card in 2018.
According to the 2018 credit card ownership statistics, only 33% of Canadians owned one credit card that year. The same percentage of people had two credit cards, while slightly less (25%) had two debit cards. More people had three credit cards than three debit cards in 2018, 18% and 4%, respectively. About 16% of Canadians had four or more credit cards, while only 2% had four or more debit cards.
Credit Card Myths and Facts
There are many myths surrounding credit card usage, credit scores, etc. If you’re unsure what to do with that one card in your wallet that you never use, you may want to check out this section. It’ll help you get a clearer picture of what are facts and what are just myths.
11. It’s a myth that you should never cancel a credit card.
Many people believe that you shouldn’t cancel a credit card that you don’t use because it might affect your credit score. However, credit card statistics show that cancelling the credit card is sometimes a better solution than keeping it without using it. The main reason for this is that credit cards may come with an expensive annual fee and no downgrading possibility. In that case, cancellation could be the best solution.
12. It’s a myth that the more credit cards you have, the better your credit score will be.
Your credit card score is calculated according to the type of credit you have (car loans, student loans, mortgage loans, etc.). Here is a surprising credit card fact that debunks the popular myth—owning multiple credit cards doesn’t necessarily mean you’ll automatically have a better credit card score. Credit reporting agencies also monitor how often you pay off your card, if you’re ever late with your payments, etc., to calculate your credit card score.
13. It’s a myth that you can’t negotiate your credit card terms.
Banks have their own policies and their own rules, but they still need you as a customer at the end of the day. For that reason, they may be flexible about some aspects of your credit card terms. If you are unsure whether your credit card is worth the annual fee, you should reach out to the bank. Negotiating could work, and it’s a myth that you must blindly agree to everything your bank offers.
Facts About Credit Card Debt
Most people are aware that credit card debt is a real problem for lots of people around the globe. These interesting facts about credit card debt will provide you with essential information on the Canadians’ average credit card limit, debt, etc.
14. 15% of Canadians have a credit card limit of less than $2000
Credit card statistics for Canada indicate that 41% of Canadians have a credit card limit of more than $10,000. The remainder has a credit card limit between $2000 and $10,000. Unfortunately, such high limits make it easier for people to rack up debt.
15. The average credit card debt in Canada is around $2000.
Facts on credit card debt put the average debt of Canadian residents at $2,627. However, credit cards are not the main reason Canadians become indebted. According to the Canadian Mortgage and Housing Corporation, credit card debt accounts for only 5.3% of all household debt in Canada. Additionally, around 50% of Canadians who have at least one credit card fully pay their credit card each month.
16. Consumer debt rose exponentially in 2020.
According to credit card debt statistics from 2020, Canadians’ consumer debt reached over $2 trillion in the fall of 2020. This was a 3.8% increase in comparison with the same period in 2019. This rise in debt is likely the result of the high demand for mortgages and car loans. At the same time, credit card use went back to the pre-pandemic rate.
E-commerce and Credit Cards
E-commerce has become increasingly popular recently. In this section you can read about interesting facts about credit cards and e-commerce.
17. E-commerce may be the reason why credit and debit cards are becoming more popular by the day.
Up to 86% of Canadians bought something online in 2019. Credit card spending statistics indicate that Canadians prefer using credit cards for online purchases for security reasons. Purchases made online accounted for over 170 million transactions worth $54 billion in Canada in 2019.
18. Clothing and footwear top the list of products Canadians buy online.
Canadians like shopping for clothes online, and the stats are here to prove that. As many as 52% of people who shopped online bought clothes or footwear. Travel comes second on this list with 37%, while electronic items account for 31% of online purchases. Credit cards dominate e-commerce with 52%. PayPal and credit cards come in second and third place with 19% and 18%, respectively.
Credit Card Statistics for 2022
Owning a credit card means learning more about credit cards with every year that goes by. What was a common practice concerning credit cards a decade ago might not apply today. For example, many present-day perks weren’t available in the past. Read this section to stay up to date on the latest facts about credit cards.
19. There are 76.2 million Visa and MasterCard cards in circulation in Canada.
The competition is tough, but Canadian banks offer a wide range of options and services to their customers to enable a seamless experience with payments. Besides banks, institutions like credit unions, caisses populaires, and retailers also offer credit card products. Furthermore, you can easily find credit cards with low interest rates in Canada. According to credit card industry trends, there are more than 30 cards with interest rates lower than 13%.
20. Rewards programs were one of the essential credit card features in 2021.
Banks offer cards with various rewards programs nowadays. Some cards even provide travel points so you can realize your dream of that tropical family vacation. Some Canadians choose to save money using cashback rewards or donate to a charity with their reward points.
Credit card trends show that up to 72% of Canadians have at least one credit card that comes with a rewards program. What’s more, having a rewards program is of the utmost importance when choosing a card for 82% of Canadians.
21. Only 8% of Canadians don’t know about rewards programs.
Not all Canadians are familiar with credit card rewards. According to the credit card statistics compiled by Simple Rate, only 8% of Canadians aren’t aware of the reward programs their cards offer nor the specifics of said programs.
22. The COVID-19 crisis has affected banks and credit card interest rates.
Banks in Canada have taken measures to help their customers. Some of those measures include reducing credit card interest rates, deferring payments, and instituting low minimum payments on credit cards, lines of credit, and auto loans. Eight banks in Canada completed 482,000 credit card deferral requests by the end of January 2021.
Interesting Facts and Statistics on Credit Card Fraud
Credit card fraud is more common than most people think it is. That’s why knowing more about credit card fraud can be of great use if you want to protect yourself and make sure your finances are safe. Read all about the most current credit card fraud stats in this section.
23. Canadian banks go to great lengths to protect their customers from fraud.
Banks in Canada make constant upgrades to their security systems to ensure their customers get the safest service. They collaborate with security and government agencies to further their safety measures. Banks’ zero liability fraud policies help protect their customers’ finances when a fraud-related problem occurs.
24. The total financial loss due to credit card fraud is in the millions.
The Canadian Bankers Association reports that the total financial loss due to credit card fraud totals over $800 million. What’s more, credit card fraud percentage has significantly increased in the past decade. The number of accounts reporting credit card fraud saw a rise of a staggering 71% in this period.
25. More than 80% of Canadians are aware of credit card fraud.
CPA Canada conducted a survey in 2019 which showed that 86% of people in Canada knew what credit card fraud was. About 39% also admitted they refused to use their card with particular establishments because they were fearful of becoming victims of credit card fraud.
After reviewing all these exciting credit card facts, it is safe to say that both credit cards and debit cards are an incredibly convenient payment method, which is why they’re rapidly gaining popularity. Low interest rates combined with rewards programs are among the leading reasons why more people decide to obtain credit cards. Additionally, e-commerce is another factor that’s pushing people towards credit cards.
How does a credit card work?
You can use credit cards to shop in physical stores or to make online transactions (e.g. if they are connected with PayPal). Upon getting a card, you get a monthly credit limit that you can use to purchase all bits and bobs you desire—like new furniture or something nice for your pet.
This is what happens when you use a credit card:
- The system forwards your credit card details to the merchant’s bank.
- The credit card network grants the bank authorization for transaction processing.
- The card issuer confirms your information.
- The transaction is either approved or declined.
How much credit card debt does the average person have?
According to the national credit card debt statistics, the average Canadian resident has a credit card debt of $2,627. More than half of Canadians who have a credit card fully pay off their credit card balance each month.
What percent of the population has a credit card debt?
The 2020 US annual financial literacy survey showed that 62% of Americans carried credit card debt in the past year. More recent information indicates that 45.4% of US households have some kind of credit card debt.
What percent of purchases are made with a credit card?
The popularity of credit cards is becoming more and more evident since credit card payments make up 39% of all retail transactions. On top of that, 56% of the total value of purchased goods and services comes from credit card transactions.
(Bank of Canada)
What should I know about credit cards?
When you’re applying for a credit card, there are a few things you should do:
- You should find out what the annual fee is.
- You should get informed about the minimum repayment (if you don’t pay off the balance monthly).
- You should also be aware of the additional charges that may apply to the card (in case of using your card abroad, etc.).
- Pay attention to interest rates, as well as rewards programs and cashback.
- Getting familiar with current credit card statistics and general trends could also help you make the right choice of credit card for you.