MasterCard to Enter Canada’s Debit Card Market in 2015
MasterCard recently announced it will be entering Canada’s debit card market in 2015 in an effort to build its business outside of the United States. Rival Visa already operates in the Canadian debit card market, and it could face heavy competition after MasterCard’s move.
MasterCard had plans to issue debit cards in Canada in 2010, but those plans never materialized. The company’s newfound interest in the Canadian market is likely attributed to the growth of the digital payments industry, which creates lucrative opportunities for debit card providers in the country.
Cash is still the most prevalent payment option in Canada, but debit cards are the second most popular method, accounting for 24% of the annual retail payments. Canadians have limited options when it comes to using their debit cards online, so MasterCard is focusing on that niche to give it a leg-up on the competition.
Despite the earning potential of this bold move, MasterCard is entering the market as the Canadian government is strictly regulating the payments industry. There are already plans in place to create new regulations for the mobile payments sector, and the high cost of processing fees is becoming an influential part of next year’s federal elections.