This study provides insight into the costs of cash, debit card and credit card payments made at the point of sale in Canada in 2014. The study uses extensive survey data from retailers, financial institutions and cash transportation companies as well as internal and external data sources. We find the following:

  • The resource costs of payments in Canada are non-negligible (0.78 per cent of GDP), which corresponds to $15.3 billion.
  • Stakeholders incur costs in providing, accepting and using payments at the point of sale, and their shares vary by payment method.
  • Debit cards are the least costly in terms of total resource costs, followed by credit cards, whereas cash is the most costly.
  • In terms of variable resource cost per transaction, cash is cheapest for transactions up to $6, while debit cards are the cheapest for transactions larger than $6.
  • If stakeholders made their payment choices based solely on their private costs, consumers would prefer to use credit cards, while retailers and financial institutions would prefer debit card payments.