HIGHER GROWTH RATES AMONG NON-CRESIT CARD HOLDERS
E-commerce cash payments in Latin America will even grow in the short term according to American Market Intelligence, because e-commerce is growing faster among non-credit card holders than credit-card holders in the countries of South America. Traditionally, Latin American e-shoppers represented the strata of the wealthiest consumers, including the upper classes, the professionals and the early technology adopters. These groups have been buying online for many years and are catered to by banks and international merchants like Amazon and eBay. E-commerce has reached substantial penetration among this population. However, while this segment will continue to buy steadily online, their numbers are not growing. The segment of smartphone owners with access to the internet is growing strongly, however. The team at AMI commonly uses smartphone owners in Latin America as a loose proxy for Internet users. This is because smartphone owners are online, are connected to social media and they consume digital content. However, while in 2017, 50% of Latin American smartphone owners have a credit card, 50% of them do not. FEWER BARRIERS TO SMARTPHONE ADOPTION More importantly, the latter group is growing faster than the former, since there are far fewer barriers to smartphone adoption than there are to credit card adoption. These consumers use cash as their main payment method for e-commerce, and as awareness spreads and savvy merchants market toward them, these cardless consumers are driving cash payment growth. So it is not surprising that payment service providers (PSPs) in Mexico report that cash payments grew between 40-50% in 2016, compared to around 30% growth for credit card payments. Source and further reading.