Jun 6, 2024

The global market for BNPL services has grown rapidly over the past five years, spurred on in part by the strong growth in e-commerce during the pandemic years. In 2023, Gross Merchandise Value using BNPL services exceeded $300 billion (USD) worldwide, up from $128.6 billion (USD) in 2019. Canadian BNPL expenditure on online purchases amounted to $12.3 billion (CAD) in 2023, representing 16.2% of online sales and 1.6% of retail sales. Growth in BNPL GMV for e-commerce purchases in Canada is expected to exceed 30% p.a. (CAGR) over the period 2023 to 2028. By 2028, Canadian online BNPL will account for 4.1% of global online GMV. More than 70% of all online BNPL users in Canada were from the Gen Z and Millennial generational segments in 2023, according to the report, but adoption in the older segments is increasing suggesting significant headroom for growth across all segments. Competition in the online BNPL space in Canada is intense, with most of the large global fintech BNPL service providers having entered the Canadian market in the past few years. Major credit card issuers in Canada have also started offering online BNPL services and have captured a significant share of the market in a relatively short time span, according to the report. The Canadian Tire Triangle Card BNPL offering has gained the most traction in Canada. The report examines the financial metrics of three key players in the fintech BNPL space and highlights some of the challenges facing the industry in terms of profitability, credit losses and funding costs. It goes on to predict that BNPL product innovation will play an important role in shaping the future of online BNPL in Canada and, while Canadian regulatory authorities have adopted a 'wait and see' approach, a strong regulatory response could have a dampening impact on the market. Growth in the market is being driven by increasing adoption, higher frequency of use, and higher average order values. This is being stimulated by intense competition, especially between fintech BNPL service providers and traditional credit BNPL providers, with product innovation playing a major role in the battle for both consumers and merchants. Additional highlights from the study are: Millennials account for the largest share of online BNPL expenditure in Canada Electronics dominates online BNPL expenditure by category, while Clothing, Footwear and Accessories has the highest proportion of BNPL users making purchase in that category Four online BNPL service providers in Canada have a GMV of more than $1 billion The Prospects for Online BNPL in Canada 2024 report provides a deep dive into the Canadian online BNPL market, examining key players, market segments and trends, the supply structure, delivery mechanisms, the competitive environment, regulatory developments, and the implications for both consumers and businesses. The central aim of this report is to provide actionable insights into the current state of the online BNPL market in Canada and the most important factors shaping its future trajectory. The forecast horizon is the five year period to 2028, with 2023 as the base year. Drawing on survey research from more than 2,000 Canadian consumers, the report is a critical strategic resource for payment professionals active in the BNPL market, providing in-depth insights and forecasts to facilitate effective strategic planning, competitive positioning and product development in this highly dynamic marketplace. Companies Featured The Evolution of BNPL