“Latin America Online Payment Market & COVID-19’s Impact” is a new publication by Germany-based secondary market research firm yStats.com. The report reveals the ranking of the top payment methods in Latin American E-Commerce and sheds light on the effect of the coronavirus pandemic on online and mobile payments in this region.
Cards Leading in Latin American E-Commerce Payments
The top payment method used by online shoppers in Latin America is bank card, according to recent surveys cited in the yStats.com report. However, due to a significant share of this region’s population lacking access to formal financial services, cash payments are also popular in countries including Argentina, Colombia, Mexico, and Peru. In Brazil, a local alternative payment method Boleto Bancario ranks second after credit card. At the same time, as large online verticals such as travel as well as in-store electronic payments are negatively affected by the pandemic, overall payments revenues worldwide are projected to decline in 2020 and resume growth in 2021.
COVID-19 Drives Digital and Mobile Payments in Latin America
Following the coronavirus outbreak, online shopping transactions received a boost in many countries of Latin America, as in-store visits are avoided or limited by lockdown regimes. As a result, online card payment transactions are on the rise, more than doubling in Chile during the last week of March alone, according to statistics referenced in the yStats.com report. In Brazil, FinTechs are helping to distribute financial aid to those affected by the coronavirus. Furthermore, proximity mobile payment user penetration in Latin America, currently reaching just over one in ten smartphone owners, could be further boosted as consumers and merchants attempt to avoid handling cash.
Competition in Latin American E-Payments Intensifies
Mercado Pago has emerged as a leading digital payment solution in Latin America. The payment service offered by Argentina-based E-Commerce giant Mercado Libre processed more payments outside of the Mercado Libre marketplace than on this platform last year. Among mobile payment services, other popular solutions include PayPal and Google Pay.