Adyen Finds Canadian Merchants Strain, Pateno Acquires XTM

Adyen’s latest survey finds smaller Canadian merchants are feeling the strain as the holiday season approaches, with soft consumer spending, rising costs and tariff issues squeezing margins.

The research, carried out last month, sampled 1,015 small and medium-size merchants across the country. Nearly three-quarters of owners said that higher interest rates, persistent inflation and new tariffs have complicated daily operations. A sizable share reported tighter profit margins because supply costs have risen, while another segment noted a decline in sales as shoppers pull back on discretionary purchases.

The same poll revealed that almost a quarter of merchants would look to borrow from a technology platform they already use, a notable jump from the single-digit figure recorded in the broader market. This shift points to a growing openness to short-term funding that does not come from traditional banks.

Adyen’s move mirrors a broader shift that began when the company launched business checking accounts and small loans in 2018, leveraging banking licences in the United States and Europe. That early expansion showed how payment processors can bundle financing with transaction services, a model now catching on in other regions. The firm’s experience demonstrates that a payments network can also act as a source of credit for its users.

The Amsterdam-based firm, founded in 2006, now competes with other players such as Stripe, Checkout.com and Payoneer in the merchant-funding space. Its Canadian division has been tasked with tailoring those products to the unique pressures faced by smaller retailers in the north.

“Canadian businesses are under real pressure right now, but there’s a clear opportunity in these findings,” said Sander Meijers, Adyen’s Canada country manager. “Owners are telling us that faster access to their own revenue and simpler paths to funding would make a real difference, especially as they grow.”

Pateno Payments Acquires XTM’s Everyday Payment Assets

Pateno Payments announced Friday it closed on acquiring XTM Inc.’s assets, including Everyday Payment program. The service lets businesses channel tips and other employee payments onto prepaid cards.

The deal follows an Ontario Superior Court of Justice approval issued Sept. 1. In February, the Bank of Canada ordered XTM to stop all retail payment activity, including Everyday Payment. A revised order later that month permitted limited retail activity under a court-appointed monitor. With these developments, the environment for payments and merchant funding in Canada continues to evolve, presenting opportunities for companies to address the needs of small businesses.