Study: Local Payment Preferences a Critical Consideration in Latin America’s eCommerce Spend 

Latin America is proving to a significant greenfield opportunity for digital payments.

In the Digitizing Payments In Latin America Playbook, a PYMNTS and Kushki collaboration, double-digit growth rates are in place throughout the region, forecast to last through the next several years. There are an estimated 267 million online consumers in the region, being served by an increasing number of FinTechs, along with incumbent financial institutions (FIs).

Cross-border commerce remains a lure, of course. For example, as noted in the November report, Guatemalan FI Banco Industrial recently announced a partnership with money transfer and remittance service Western Union that will enable its users to make and receive money transfers from more than 200 countries. Between 7% and 10% of Guatemalans live abroad, as we noted, “meaning it is critical for customers both inside and outside the country to have easy access to swift digital payments.”

In Latin America, as in other markets, satisfying local payment preferences is critical. As noted by PYMNTS and Kushki, recent reports on 14 global markets — including eight Latin American countries — found that local payment methods accounted for 83% of eCommerce spending.

In the meantime, cash still makes up as much as a quarter, or more, of eCommerce transactions in Latin America. Usage of plastic credit and debit cards, QR code tools and mobile wallets has been gaining ground.

As noted in the tracker, 56% of Latin American eCommerce purchases were made with credit cards in 2020, for example, while 14% of these purchases tapped debit cards. Moreover, 66% of Latin American consumers say they anticipate using the (relatively more recent technological advances) of mobile wallets and QR codes through the next few years.