Canadian Credit Cards - US

Published by: Mintel International Group Ltd.

Published: Sep. 1, 2009 - 109 Pages

Table of Contents

SCOPE AND THEMES

Scope of this report

What you need to know

Data sources

Consumer survey data

Advertising Creative

Abbreviations and terms

Abbreviations

Terms

Companies mentioned in this report

EXECUTIVE SUMMARY

Industry highlights

Changing landscape

Consumer attitudes towards credit cards

MARKET SIZE AND CHARACTERISTICS

Key points

Total market size and top players

Figure 1: Top Canadian credit card issuers ranked by receivables, year ending April 2008 and April 2009

Figure 2: Canadian credit card banks, card service revenue, three months and six months ending April 2008 and April 2009

COMPETITIVE CONTEXT - BANKING OVERVIEW

Key points

Bank regulation in Canada

Figure 3: Big five Canadian banks, April 2009

LEADING ISSUERS

Key points

CIBC (Canadian Imperial Bank)

Royal Bank of Canada (RBC)

Scotiabank

TD Bank (Toronto-Dominion)

MBNA Canada Bank

BMO (Bank of Montreal)

Desjardins Group (Fédération des Caisses Desjardins du Québec)

Canadian Tire

Capital One Bank Canada

J.P. Morgan Chase Canada

Citigroup

American Express

CANADIAN PAYMENTS LANDSCAPE

Key points

Figure 4: Credit Card payment rate (percentage of outstanding balance paid), March 2000 through March 2009

Interac Association

Figure 5: Top five countries in debit use, 2007

Figure 6: Interac Direct Payment transactions, merchants, terminals, C$ value, and users per year, 1997-2008

Figure 7: Payment method used most among ABM cardholders, 1997-2008

Credit card share is growing

Visa vs. MasterCard share

MasterCard is growing faster but is still well behind

MasterCard leads in cards and accounts

Figure 8: Visa vs. Mastercard in Canada, 2008-07

Figure 9: Credit card statistics, VISA and MasterCard, 1990-2008

MARKET DRIVERS

Key points

Figure 10: Credit card delinquency and loss statistics, VISA and MasterCard, 2004-09

Economic forecast: Stronger growth expected in Canada

Strong growth in disposable incomes

Significant differences between Canada and U.S. housing markets

Figure 11: Subprime mortgage default rates, U.S. and Canada, 2001-08

Figure 12: Prime mortgage default rates, U.S. and Canada,1998-2008

CANADIAN POPULATION AND IMMIGRATION TRENDS

Key points

Figure 13: Canadian population, by province, 2004-08

THE REGULATORY ENVIRONMENT AND DUALITY

Key points

Duality and debit cards

What’s likely to happen next

Consumer awareness of credit card duality

Figure 14: Awareness of ending of duality ban, by gender, June 2009

Figure 15: Awareness of ending of duality ban, by province, June 2009

Figure 16: Has recently been offered another card brand, by gender, June 2009

Figure 17: Has recently been offered another card brand, by income, June 2009

Figure 18: Has recently been offered another card brand, by race, June 2009

CREDIT CARD REGULATION AND LEGISLATION - OTHER DEVELOPMENTS

Key points

INNOVATIONS AND INNOVATORS

Capital One’s guaranteed MasterCard for newcomers

Figure 19: Capital One Guaranteed Mastercard for newcomers direct mail advertisement, 2009

ADVERTISING AND PROMOTION

Key points

Direct mail volume plunges in first quarter 2009

New and notable credit card direct mail campaigns

Figure 20: MBNA direct mail advertisement, 2009

Figure 21: Scotiabank direct mail advertisement, 2009

Figure 22: Scotiabank direct mail advertisement, 2008

Figure 23: Citibank direct mail advertisement, 2009

Figure 24: CIBC direct mail advertisement, 2008

Figure 25: CIBC direct mail advertisement, 2009

Figure 26: American Express direct mail advertisement, 2009

Television advertising

Figure 27: RBC television advertisement using Andy Kim celebrity endorsement, 2009

Figure 28: RBC small business television advertisement, 2009

Figure 29: TD Bank television advertisement with Kelly and Regis, 2009

Figure 30: TD Banknorth television advertisement with Kelly and Regis, 2009

Figure 31: TD Banknorth television advertisement with Kelly and Regis, 2009

Figure 32: TD Banknorth television advertisement with Kelly and Regis, 2009

THE CONSUMER

Key points

Miles, points, or cashback?

Figure 33: Credit card types owned, by gender, June 2009

Figure 34: Credit card types owned, by age, June 2009

Figure 35: Credit card types owned, by HH income, June 2009

Figure 36: Reasons for using credit cards, by gender, June 2009

Figure 37: Credit card types used, by HH income, June 2009

Credit, debit, or cash?

Figure 38: Payment methods used, by gender, June 2009

Figure 39: Payment methods used, by age, June 2009

Figure 40: Payment methods used, by HH income, June 2009

Credit cards preferred for big-ticket items

Figure 41: Credit card usage preference by category, averages of a 5 point scale where 1=never and 5=always, by gender, June 2009

Figure 42: Credit card usage preference by category, ranked, by age, June 2009

Figure 43: Credit card usage preference by category, by HH income, June 2009

Canadians are aggressive about paying off balances

Figure 44: Card payment activity, by gender, June 2009

Figure 45: Card payment activity, by age, June 2009

Figure 46: Card payment activity, by HH income, June 2009

Figure 47: Credit card balances, by gender, June 2009

Figure 48: Credit card balances, by age, June 2009

Figure 49: Credit card balances, by HH income, June 2009

Canadians stick to one or two cards

Figure 50: Number of cards used each month, by gender, June 2009

Figure 51: Number of cards used each month, by age, June 2009

Figure 52: Number of cards used each month, by HH income, June 2009

Canadians read direct mail, but are leery of e-mail

Figure 53: Attitudes towards credit card advertising, by gender, June 2009

Figure 54: Attitudes towards credit card advertising, by age, June 2009

Figure 55: Credit card mail solicitations received, by gender, June 2009

Figure 56: Credit card mail solicitations received, by age, June 2009

Figure 57: Credit card mail solicitations received, by HH income, June 2009

Building credit is a major influence on choosing a card

Figure 58: Major influences on credit card choice, by gender, June 2009

Figure 59: Major influences on credit card choice, by age, June 2009

Figure 60: Major influences on credit card choice, by HH income, June 2009

Debit is preferred over credit cards; the internet still worries many

Figure 61: Opinions about credit cards, by gender, June 2009

Figure 62: Opinions about credit cards, by age, June 2009

Figure 63: Opinions about credit cards, by HH income, June 2009

Recent penalty actions taken by credit card issuers

Figure 64: Recent actions by credit card issuer, gender, June 2009

Figure 65: Recent actions by credit card issuer, by age, June 2009

Figure 66: Recent actions by credit card issuer, by HH income, June 2009

Figure 67: Recent actions by credit card issuer, by province, June 2009

Canadians not loyal when it comes to credit cards

Figure 68: Recent credit card related activities, by gender, June 2009

Figure 69: Recent credit card related activities, by age, June 2009

Figure 70: Recent credit card related activities, by HH income, June 2009

Figure 71: Recent credit card related activities, by province, June 2009

Recent credit card behavior

Figure 72: Recent credit card behavior, by gender, June 2009

Figure 73: Recent credit card behavior, by age, June 2009

Figure 74: Recent credit card behavior, by HH income, June 2009

Figure 75: Credit card use compared to one year ago, by gender, June 2009

Figure 76: Credit card use compared to one year ago, by age, June 2009

Figure 77: Credit card use compared to one year ago, by province, June 2009

THE CONSUMER - FOCUS ON ASIAN NEWCOMERS

Key points

Asians are highly desirable credit card customers

Figure 78: Opinions about credit cards, by race/ethnicity, June 2009

Figure 79: Recent credit card behavior, by race/ethnicity, June 2009

Figure 80: Credit card usage preference, by category, ranked, by race/ethnicity, June 2009

Figure 81: Recent actions by credit card issuer, by race/ethnicity, June 2009

Figure 82: Credit card types used, by race/ethnicity, June 2009

Figure 83: Major Influences on credit card choice, by race/ethnicity, June 2009

Figure 84: Attitudes towards credit card advertising, by race/ethnicity, June 2009

APPENDIX: TRADE ASSOCIATIONS

Abstract

An industry overview

The typical Canadian owns half as many credit cards as his American counterpart, and pays off his credit card balance about twice as fast.

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