Everything you need to know about payment localization in today’s fastest growing markets

With $7.7 billion in total e-commerce spending in 2017 and a compounded annual growth rate (CAGR) of 37% for 2019, Argentina is Latin America’s third-largest market for e-commerce. Merchants without a local payments strategy are unable to reach 79% or $6.1 billion of the Argentine e-commerce market. Installments are especially important in this market where local cards and alternative payment methods are prevalent.

Internet penetration: 93%   |    Smartphone penetration: 73%

With a population of 202 million and projected $41 billion e-commerce market in 2019, Brazil is the largest economy in Latin America in e-commerce and beyond. Accounting for nearly 36% of the entire region, Brazil’s e-commerce market expects to remain among the top 10 e-commerce markets globally due to the projected growth of 17% through 2021.

Internet penetration: 70%   |    Smartphone penetration: 67%

Chile is the country with the highest banking and Internet penetration in the region. The country’s smartphone penetration is also high — at 76% and growing. Its e-commerce indicators are impressive, as well. Chileans are quite comfortable with online shopping and spend almost twice as much per capita as shoppers in Brazil and Argentina.

Internet penetration: 82%   |    Smartphone penetration: 76%

Supported by an open economy, a stable political environment, and a burgeoning tech industry, Colombia’s e-commerce market of $7 billion is the fourth-largest in the region and is expecting to reach $15 billion by 2021.

Internet penetration: 68%   |    Smartphone penetration: 75%

E-commerce in Ecuador is still relatively small. Similar to other markets in LATAM, the main reason for consumers not buying online is the lack of trust. However, new technology and information available are shifting people’s behavior, feeling more confident with putting their payment information online, and taking the market to the expected $1.2B in 2020. One particularity that makes this market different is that the main currency is US dollars.

Internet penetration: 79%

Mexico is Latin America’s second-largest market for e-commerce. It is expected to reach nearly $48 billion by 2021. Smartphone penetration is at 72% and continues to expand rapidly. Global merchants accepting credit cards through international rails, tap into 40% of e-commerce spend. However, 46% of total e-commerce volume is generated by local debit cards and popular cash payments like OXXO and thus only accessible to merchants who are offering local cards and cash in their payment mix.

(Law & Regulations)

Internet penetration: 67%   |    Smartphone penetration: 72%

Paraguay is a small and open economy with nearly 7 million people and a GDP of $41 billion. Over the past decade, the Paraguayan economy grew on average 5% annually. The country’s $1.3 billion e-commerce market is growing, as well the country’s internet penetration.

Internet penetration: 89%

Although Peru is one of the smallest e-commerce markets in Latin America and still, a very much cash economy, Peru’s $3.3 billion e-commerce market is growing rapidly. It is forecasted to grow 40% year-over-year through 2019. In 2016, 91% of online sales took place on a desktop and 85% were to local Peruvian merchants.

Internet penetration: 73%   |    Smartphone penetration: 58%

In LATAM, Uruguay is referred to as a ‘país boutique’ or a boutique country. With a small population of 3.4 million and exemplary e-commerce development metrics for Latin America, Uruguay’s e-commerce market is growing at a rapid 31%. Uruguayans are highly computer and mobile literate, and the country’s Internet and smartphone penetration, at 88% and 65% respectively, have positioned Uruguay well ahead of most of its neighbors.

Internet penetration: 88%   |    Smartphone penetration: 85%