The online payment market in Latin America was profoundly impacted by the COVID-19 health crisis in 2020.
With the governmental restrictions imposed in 2020, businesses and consumers started adopting new ways of paying. Namely, mobile payments gained momentum in the region, with regional B2C E-Commerce leader Mercado Libre reporting that over 70% of its sales were done through mobile device.
The leading country in the region in mobile online sales was Mexico.
However, in spite of the strong smartphone penetration in the region, proximity mobile payment use is not widespread: in Brazil, the slightly over 20% of all smartphone users in 2021 used proximity payments, while in Mexico the share was a bit over 14%.
When looking at payment methods specifically, cash usage clearly declined amid the pandemic, with over 60% of consumers responding in a survey that they used cash less due to COVID-19 in 2020 by at least 20%.
The most common payment form during online and offline shopping in the region was a “credit card” in 2020, whereas the second choices in both types of purchasing differed, with a “debit card” being in shopping online, and “cash” in shopping in-store.
Additionally, real-time payments also gained some momentum in 2020, and although they are not significantly developed yet, the projections are strong for such transactions.
Namely, in Colombia, the RTP transactions are projected to grow at a CAGR of over 100% from 2020 to 2025, and in Peru, the growth rate was forecasted to be more than 70%.