Canadian Businesses See Virtual Cards, Real-Time Payments as Key to Cutting DSO

Canadian firms are struggling to get past the pandemic receivables slowdown. Twenty percent of all Canadian businesses report experiencing longer days sales outstanding (DSO) now than just prior to March 2020, waiting an average of 41 days to realize revenue from their sales. This is putting all new pressure on the financial decision-makers to relieve ongoing payments frictions and get their payments flows running faster and smoother.

This is only one of the key findings from Accelerating The Time To Realized Revenue: Canada Snapshot, a PYMNTS and Mastercard collaboration. We surveyed 100 Canadian corporate executives from across the manufacturing, healthcare, transportation, logistics and shipping sectors about how the ongoing pandemic has impacted their payments operations and their overall interest in using virtual cards and real-time payments to alleviate those frictions. 

Key findings from our research include:

• Mid-market Canadian firms’ average DSO is 10% longer than seen among large-market Canadian firms. Canadian businesses generating between 10 million Canadian dollars ($7.8 million) and 500 million Canadian dollars ($390 million) report having an average DSO of 43 days, while firms generating more than 500 million Canadian dollars see an average DSO of 39 days.
• Fifty-two percent of Canadian businesses currently use virtual cards, with those that do citing many benefits. Sixty-nine percent of Canadian businesses that use virtual cards cite faster payments receipt as one of their chief benefits, and 40% cite improved transactional detail as such.
• Thirty-seven percent of all Canadian firms are “very” or “extremely” interested in real-time payments. The key benefit they expect to gain from using real-time payments is the ability to make and receive payments 24/7 year-round, with 35% of interested firms citing this as such.

These are only a few of the myriad benefits that Canadian firms expect to gain from adopting virtual cards and real-time payments going forward. Accelerating Time To Realized Revenue: Canada Snapshot explores all of these benefits and more.

To find out more about how Canadian firms believe virtual cards and real-time payments can enhance their businesses, download the snapshot.