Breaking News

Tweet TWEET

The Power of Electronic Payments Stimulates Economic Growth in Canada

The Power of Electronic Payments Stimulates Economic Growth in Canada 
Study Concludes that Debit and Credit Card Usage Boosted Gross Domestic 
Product (GDP) in Canada, and Global GDP by $983 Billion between 2008 and 2012. 
TORONTO, Feb. 7, 2013 /CNW/ - The growth in the use of electronic payment 
products, such as credit and debit cards, added US$9.7 billion to the Gross 
Domestic Product (GDP) of Canada over the past four years, according to a 
study conducted for Visa by Moody's Analytics, a leading independent provider 
of economic forecasting. 
The study of 56 countries, including Canada, that represent 93 per cent of 
global GDP, concluded that: "card usage makes the economy more efficient, 
yielding a meaningful boost to economic growth." 
Globally, electronic payments contributed $983 billion to the GDP of the 56 
countries examined between 2008 and 2012. Over the same time period, GDP in 
those countries grew by an average of 1.8 percentage points. 
"With growing card usage contributing $9.7 billion to Canada's GDP, there's no 
denying the benefits of electronic payments here, or the importance of 
maintaining an open marketplace to encourage competition and innovation within 
the industry. We can see from the data that the positive impact in economic 
growth is a direct result of card usage and is tied to the benefits electronic 
payments offer, including enhanced security, convenience of operating without 
cash or cheques, increased efficiency at checkout and a reduction in the grey 
economy," said Jim Allhusen, Visa country manager for Canada. 
Allhusen continued, "We are excited about the prospects of increasing 
electronic payments in Canada through new, innovative solutions, and we look 
forward to working with local businesses, governments and industry 
stakeholders to continue to expand and support economic growth." 
"Despite a challenging global economic landscape, the increasing penetration 
of payment cards helped increase consumer consumption and on average, added to 
GDP," noted Mark Zandi, Chief Economist of Moody's Analytics. "The increase in 
consumption parallels the growing popularity and accessibility of electronic 
payments among global consumers. At the same time these findings point to the 
need for governments to adopt policies that encourage the shift to efficient 
and secure electronic forms of payments." 
Highlights of the study include: 


    --  Regional Economic Growth: Across North America, the adoption of
        electronic payments increased GDP. In addition to the US$9.7
        billion increase in Canada, electronic payments helped increase
        GDP in the U.S. by US$127.4 billion and in Mexico by $7.8
        billion.
    --  Value of Electronic Payments: The study concluded that
        increased credit and debit card usage contributes to economic
        activity by reducing transaction costs and improving efficiency
        in the flow of goods and services. The advent of credit and
        debit cards has greatly aided consumers' ability to optimize
        consumption decisions by giving them secure and immediate
        access to all of their funds on deposit or a line of credit.
        Merchants also benefit because there is less cash and cheque
        handling in the system, eliminating the burdens and risks
        associated with holding cash. In addition, the dramatic growth
        of eCommerce and mobile payment methods would not be possible
        without global electronic payment systems, which allow the safe
        and easy transfer of funds and guaranteed payment to merchants.
    --  Supporting Government: Electronic payments lead to a reduction
        in the grey economy, or unregulated market, by increasing
        transparency and generating additional tax revenue.
    --  Impact of Future Card Growth: Moody's Analytics found that a
        one per cent increase in card usage across the 56 countries in
        the study produces an annual increase of 0.056 per cent in
        consumption. Given recent card penetration growth rates and the
        additive effects calculated on future GDP, globally, Moody's
        Analytics estimates a meaningful 0.25 per cent addition to
        consumption and 0.16 per cent additional GDP.
    --  Card Growth Boosts Recovery: From 2008 to 2012, global real GDP
        was only 1.8 per cent per year. Without increased card usage,
        that growth would have been 1.6 per cent. Card penetration and
        usage provided an important boost to economies, helping to
        mitigate what would otherwise have been an even slower recovery
        from the global recession.

This survey is the second iteration, following a study conducted by Moody's 
Analytics from 2003 to 2008.

The study and an accompanying white paper can be found at: 
www.corporate.visa.com/newsroom/media-kits/economic-impact.

Visa is a global payments technology company that connects consumers, 
businesses, financial institutions and governments in more than 200 countries 
and territories to fast, secure and reliable electronic payments. We operate 
one of the world's most advanced processing networks—VisaNet—that is 
capable of handling more than 24,000 transaction messages a second, with fraud 
protection for consumers and assured payment for merchants. Visa is not a bank 
and does not issue cards, extend credit or set rates and fees for 
consumers.Visa's innovations, however, enable its financial institution 
customers to offer consumers more choices: pay now with debit, ahead of time 
with prepaid or later with credit products. For more information, visit 
corporate.visa.com

Erin Sufrin Visa Canada Tel: 416-860-3869 esufrin@visa.com

SOURCE: VISA Canada Corporation

To view this news release in HTML formatting, please use the following URL: 
http://www.newswire.ca/en/releases/archive/February2013/07/c3648.html

CO: VISA Canada Corporation
ST: Ontario
NI: ECOM FIN ECOSURV 

-0- Feb/07/2013 14:00 GMT


 
Press spacebar to pause and continue. Press esc to stop.