North America’s Most Popular Payment Methods

Payment methods in North America, the United States and Canada
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Although credit and debit cards (Visa, Mastercard, American Express, and Discover) have good penetration in North America, new alternatives are making a significant impact. The team at Payments and Commerce Market Intelligence (PCMI) forecasts that, by 2026, digital wallets will outperform cards with a stunning 41% share of turnover (versus 39% in cards), at least where e-commerce is concerned. However, it is important to note that in the North American market the most commonly used wallets are Apple Pay and Google Pay, which represent digital form factor of cards.

Further changes to this scenario are likely if RTP systems like FedNow gain momentum. In any event, the dynamic will be quite different from what we will see in, say, South America: here where the popular Pix payment method originated, we forecast that digital wallets will account for just 9% of turnover for e-commerce in 2026, while cards and A2A methods will have a 56% and 24% share respectively.

2026 forecast of payment methods in five regions worldwide: North America, South America, Africa, Europe and Asia.

PCMI is constantly monitoring payment methods globally and in specific regions, including Latin America, Europe, Africa, the Middle East, Asia-Pacific, and, our focus in this article, North America. Here we will highlight the payment methods with the highest market share in North America, to then show payment methods used in the United States and Canada. Just for clarification, although Mexico forms part of North America geographically speaking, we need to exclude it from analysis in this article as we count Mexico among the countries of Latin America.

Most common payment methods for e-commerce purchases in North America

These are the most significant e-commerce payment methods in North America by share of transaction volume in 2023 (WorldPay, 2024):

E-commerce payment methods in North America. Digital wallets account for 37% market share in North America in 2023; credit cards, 33%.

Digital wallets are the most widely used payment method in North America. In 2023 digital wallets had a 37% share of turnover, according to Worldpay, and that figure is projected to reach 51% by 2027. According to the firm’s analysis, regional spending on digital wallets has been influenced largely by the card transaction model in wallets such as Apple Pay, Google Pay, and PayPal. In part, the use of these kinds of wallets will cannibalize direct card use.

The Buy Now Pay Later (BNPL) model, despite maintaining a low market share, will continue defending its position as we reach 2027. The region’s BNPL leaders, like Affirm or Klarna, have reported good returns in their quarterly reports (Worldpay, 2024).

According to PCMI’s reports, after e-commerce saw an annual growth rate of 24% in 2020, the forecast for the North American region shows a decrease to 12% in 2026. By 2026, North American e-commerce will reach US$2.5 trillion.

Most common payment methods for in-person purchases in North America

The following are point-of-sale (POS) payment methods in North America, i.e., at brick-and-mortar stores and for in-person transactions (Worldpay, 2024):

Payment methods in North America in physical purchases (point of sale, POS). Credit cards account for 42% of POS' market share in 2023 in North America.

Looking at point-of-sale payment methods in North America, Worldpay notes that:

Consumers at physical stores in North America still prefer to pay directly with cards, especially credit cards. Despite this, the use of plastic cards as a payment method will have decreased 2% annually by 2027.

Digital wallets have taken some time to achieve the marked success they have in e-commerce. However, they are growing at an unprecedented rate: their POS use increased by 36% in 2023 and will continue to grow exponentially as we reach 2027, when they will have a 31% share of the market.

Leading payment methods in the United States

In North America, the United States promises to be the country with the most interesting dynamic in payment methods following the launch of FedNow in 2023, responding to the rise of RTP systems around the world. In the United States, this system would reduce the banks’ dependence on legacy payment systems, allowing them to offer more agile, competitive services. Current ACH and Wire methods are slower.

However, FedNow is barely at the groundwork stage; in the meantime the direct influence it will have on the American consumer is minimal. In the short term, PCMI estimates FedNow’s main impact will be at the B2B level.

According to Worldpay (2024), these are the most widely used payment methods in the United States, based on their market share in 2023:

Payment methods in the United States, for e-commerce and POS (point of sale). Digital wallets have a 37% share of e-commerce payments in the US. Credit cards have a 41% payment share at POS in the US.

According to the firm’s analysis:

Consumers still prefer cards, which, all together, accounted for 71% of spending in the United States in 2023.

Much card spending takes place in digital wallets, the payment method in the United States with the highest growth rate both at the POS and in e-commerce.

The BNPL method has much potential (it grew by 23% in 2023), but is in the sights of regulators. The Consumer Financial Protection Bureau (CFPB) has expressed concern that “BNPL was used disproportionately by already stressed consumers.” We anticipate new regulations are on the way.

Something important to mention about payment methods in the United States is that there are high expectations regarding the adoption of open baking. In fact, the United States is seen as a more or less developed country in terms of open finance (if we compare it to the American continent as a whole). In the US, open banking has developed through private initiatives like Plaid, but it still needs a push from government. On the plus side, the CFPB has already begun to discuss the issue of privacy. In October 2023 it launched a regulatory proposal for the proper use of and rights to the personal financial data of consumers.

Leading payment methods in Canada

Canada relies on credit and debit cards far more than the United States (where digital wallets will soon take the lead).

Even so, Canada has its own payment method dynamics. For example, it is the cradle of the “Interac” method, a payment system, which, though closed and private, has a high growth rate: 27% annually by 2026. Interac currently allows payments between people (P2P) and businesses (P2M). By contrast, Pix, Brazil’s interoperable, government-promoted RTP system, is estimated to grow 26% annually by 2026. Pix allows for a wider variety of payments, including P2P, P2M, M2P, and B2B.

According to Worldpay (2024), these are the most widely used payment methods in Canada, based on their market share in 2023:

Payment methods in Canada, e-commerce and POS (point of sale). Credit cards have the largest market share in Canada, with 47% in e-commerce and 50% in POS.

According to the firm’s analysis:

Estimates in volume and growth of account-to-account (A2A) transactions could change if Real Time Rail (RTR)—a new real-time payment system promoted by Payments Canada—finally gets launched.

By 2027, digital wallets in Canada are expected to reach a penetration of 43% and 28% in e-commerce and point-of-sale purchases, respectively. Currently, the most widely used digital wallets in Canada are Apple Pay (42% of respondents), PayPal (23%), and Google Pay (22%).

Nearly 50% of payments in Canada are made with credit cards. Their share is expected to drop by up to 10 percentage points by 2027.

The BNPL method in Canada will defend its current market share between now and 2027. Giants like Amazon and Walmart have deployed BNPL solutions in Canada, in partnerships with Affirm and Klarna, respectively.

Next Steps

Contact us if you would like to move beyond these data to understand why certain methods are predominant in specific countries like Canada and the United States, and what changes we should expect in the future. Our team can design a study to provide this kind of analysis, as well as other types of market research, including:

  • Competitive intelligence about your rivals in different markets

  • Assessment of potential partners if you are interested in entering a new market

  • Assessment of opportunities with different sectors or subsectors of the market in specific countries

  • Analysis of behaviors and trends in consumer use of payment methods, online and offline consumption, and more

We also invite you to explore our services.


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Sources:

  1. Worldpay, 2024. “The Global Payments Report 2024
  2. PCMI, 2024. “2024 Payments Megatrends — Americas”.
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Payments and Commerce Market Intelligence (PCMI) is a strategy consultancy specializing in the global payments industry.

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