The challenge of monetization in the Latin American market consists of overcoming the obstacles of the unbanked population (over 65%), intricate regulations and unstable economic systems. However, it is well worth the effort to gain a foothold in this promising market with its considerable middle-class growth over the past ten years.
Though we often regard Latin American countries as one region, the landscape is not uniform and the countries are at different stages of development.
The mainstream solutions, like credit cards and online banking, popular in the countries with a developed financial structure, haven’t reached the majority of the population yet. Mobile phone payments, prepaid options, and bank deposits dominate the landscape.
Adding these payment options will help you to reach a broader range of customers that otherwise would stay outside due to the undeveloped infrastructure in their region.
Most of these options are based on the principle that the customer is able to pay the bill in cash at a local retail store or kiosk. Thus, online payments are made available to the population having no bank account, which is as high as 250 million people in Latin America.
We will give you an overview of the most popular payment methods per country and their potential for your business.
Brazilian payment options
Brazil is the largest e-commerce market in Latin America. According to the latest reports, it accounts for 42% of the region’s $47.4 billion in e-commerce sales.
To reach the wider mass of consumers it is indispensable to offer Boleto Bancário which is an invoice with a barcode that can be issued online and paid offline in many retail stores and ATMs. This payment method is regulated by the Brazilian Federation of Banks and is free of chargebacks.
To complete the offer it is recommended to go for the local e-wallets like MercadoPago or PagSeguro that can be topped up with cash, bank transfer, debit cards. Bank transfers and local credit cards like Hipercard and Elo are also very popular.
Payment methods in Mexico
Mexico is the second-largest market for e-commerce in Latin America. Mexico currently accounts for 12.3% of the region’s e-commerce. Consulting companies see a bright future for this market and expects its share to increase to 15.6% by 2019. Consider adding cash options, like the voucher OXXO and Toditocash.
How to accept payments from Argentina
In Argentina, the cash payments are offered by RapiPago and Pago Fácil. The principle is the same – print the voucher and bring it to one of the ubiquitous retail shops. Local Bank transfers, for example, with Santander Rio will complete the offer.
Other LatAm countries have developed their own payment methods, like Efecty, Davivienda, PSE, and Baloto in Colombia; Efectivo in Peru; Redcompra in Chile; or Redpagos in Uruguay.
Paymentwall has partnered with all major payment methods in the region and provides access to them via a single API. Please contact us at email@example.com to get more information.