How does Mexico pay?

"Mexico, the second-largest economy in Latin America, is a strategic market for global eCommerce players due to its high internet penetration of 78.6%, 92 million smartphone users1 , and population of 128 million. Currently, cross-border sales equate to 22% of its eCommerce - driven by its proximity to the United States and American merchants.

With its GDP of USD$1.75 trillion2 , forecasts suggest Mexico's eCommerce sales will grow with a compound annual growth rate (CAGR) of 12.9%, making its eCommerce development the fifth fastest globally

How Mexico pays

How Mexico pays The majority of Mexico's digital purchases are made using a smartphone4 , which aligns with the country's high internet and mobile penetration rates. Seven out of ten adults in Mexico make online purchases, with 13% of all retail sales in Mexico stemming from eCommerce.

Local credit cards make up the bulk of Mexico's online transactions at 33%, with eWallets next in line at 27%. Debit cards come third with 23%. However, a portion of the population still prefers cash, even online at 8%, due to limited banking access and security worries. Therefore, offering a mix of both digital and cash payment options is critical to reaching a broader, more inclusive customer base.

The future of cross-border commerce in Mexico

Mexico is currently experiencing the fastest growth rate in cross-border transactions, with a compound annual growth rate (CAGR) of 44%. By 2026, it is expected that the country will account for 42% of the total volume of cross-border sales among Argentina, Brazil, Chile, Colombia, and Peru.

The above compliments reports suggesting that nearshoring, the relocation of manufacturing chains to Mexico rather than Asia will add to the country's growth8 in the coming years. In the first six months of 2023, Mexico received approximately USD$29 billion in foreign direct investment8 , with more than half of the funds going towards the industrial sector.

The digital commerce market in Mexico is expanding due to increased connectivity, addressing financial inclusion, and expanding on digital literacy - making it a promising industry for Mexican consumers and international companies alike."

Author

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