LATAM (Latin America) eCommerce is booming and is expected to reach new heights in the coming years. The largest growth comes from shoppers in Brazil, Mexico and Argentina. By 2020, these three countries are expected to reach $30.9B in sales, up from $20.8B in 2015. The compound annual growth rate for all of LATAM is expcted to be 17% between 2014 and 2019.
But there are challenges to capturing this market opportunity:
- In Brazil, 74% of shoppers use local credit cards and 30% use Boletos, a cash payment method.
- In Mexico, 53% of shoppers use local credit cards.
- In Argentina 65%. Of shoppers use local credit cards.
But most other countries use credit cards, so why is this a problem? The distinction here is that LATAM countries are using local credit cards, which means most merchants don’t have connections to the proper banks to process these cards. In fact, without access to these local banks, payment conversions are less than 50%, compared to 75%+ conversion rates with local card acceptance.
These are just a few reasons why historically there have been barriers to selling into the LATAM market. Along with local cards and poor payment conversion rates, the cost of processing and taxes can be prohibitive.
The Answer to the LATAM Problem
BlueSnap is excited to announce that we have recently improved our solution for Latin America to address all the traditional market barriers to entry. Our solution is ideal for international merchants selling in to Brazil, Mexico, Argentina, Columbia or Chile.
First, we make the shopper experience frictionless with the local languages, local currencies and local credit cards and payment methods LATAM shoppers expect to see during checkout.
And we’ve simplified the merchant experience. Merchants have only one point of contact – via BlueSnap. Once BlueSnap approves you for credit card processing, we automatically connect you to multiple banks in each LATAM country. We collect funds on your behalf and remit to you anywhere outside of our five supported countries, so you do not need to have a local entity in LATAM which can reduce your tax burden.
Through a single integration to us using Hosted Pages or APIs, you get access to all the markets and payment methods that we offer. And we support any additional information that is required by the banks and government in the LATAM market – like the unique Shopper CPF (Cadastro de Pessoas Fisica – a tax ID number) in Brazil.
We can also give you guidance on best practices in each region, for example – when selling digital goods in Brazil, make sure you are offering local cards and Boletos; publish your website Terms &Conditions in the local language, and provide additional information like a product description to improve payment conversions.
Thanks to a frictionless shopper experience, local credit cards with built-in bank failover capabilities to improve payment conversions, and a competitive rate without the burden and cost of complex taxes, our new solution is your ticket to tackling the LATAM market.
If you are an existing BlueSnap merchant, contact our merchant support team to enable LATAM processing.