Cross-border opportunities in Latin America for betting, crypto and other key verticals
PagSeguro International
PagSeguro enables worldwide merchants to easily access Latin America by offering local payment methods.
In our new exclusive white paper, we deep-dive into Latin America’s e-commerce market, bringing a complete scenario of the retail, travel, betting, gaming, streaming, online education, and cryptocurrency verticals, as well as predictions until2026. The full study, titled E-commerce and Payment Landscape in Latin America, can be downloaded for free here.
In this first edition of our newsletter, check out some more key pieces of information about current and future opportunities in the Latam market:
How to get ahead in Latin America for 2024
Summing up a total of US$ 479 in sales in 2023, Latin America’s Top Six Markets for e-commerce – Brazil, Mexico, Colombia, Chile, Argentina, and Peru, in order of sales volume – should reach US$ 870 billion by 2026. Of that total, 13% will come from cross-border sales, which rise year by year even faster than domestic spending.
The Latam region had already been moving more and more toward e-commerce even before 2020, but the pandemic definitely pushed matters much further – and faster – than before: 82% of the adult Latin American population made an online purchase in 2023, almost the exact same share of people who have access to the internet in the region (83%).
From here on out, shopping online will remain cemented as the preferred way for Latam customers to purchase. On one hand, the region’s giants – Brazil and Mexico – will keep growing until 2026, when they will reach US$ 435,4 and US$ 176,8 in online sales, respectively; on the other, laggard markets such as Peru are just now catching up with its neighbors that grew exponentially during Covid-19.
Cross-border sales push growth across key verticals
The total e-commerce market in Latin America rises 22% per year, with domestic sales growing by 21% per year until 2026. Meanwhile, the cross-border volume rises by 30% per year – especially impressive considering the massive drop foreign e-commerce suffered during the pandemic.
Now coming up to USD 52.5 billion, the total cross-border volume in the region should reach USD 114.6 billion by 2026, when it will represent 13% of the online sales volume in the top six markets. Let’s take a look at the main verticals shaping the Latam market landscape.
Betting (iGaming)
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This is definitely Latin America’s e-commerce current shining star, rising faster than all other verticals with a 38% CAGR until 2026 – when it should reach a total volume of US$ 6 billion, almost doubling 2023’s US$ 2,3 billion volume. Of that, 11% comes from cross-border sales.
With different levels of regulatory maturity in each of its main markets, betting in Latin America requires local expertise not only for payment processing and payment method strategy, but to understand and comply with ever-changing laws and market trends. Sports betting in particular is a major force in the region, where the once-stigmatized vertical is more and more seen as a legitimate form of entertainment.
Cryptocurrencies?
Another vertical leading e-commerce volume and innovation in Latam is crypto – also once seen as too adventurous by some, now more popularly adopted. Considering that the main markets of the region are also among the world’s most important cryptocurrency markets – Brazil in the 7th place, Argentina in the 13th, Colombia in the 15th, Mexico in the 28th, and Peru in the 35th –, Latam should definitely be a part of cross-border crypto strategies.
Crypto is a very peculiar vertical, much harder to predict than others – instead of growing shopping and consumer trends, it goes through “bull market” and “bear market” years, with crypto value appreciating in the former and depreciating in the latter.
For now, expectations are that the crypto vertical will grow by 22% in 2024, but then go through decreases in 25 and 26 – “bear market” years. What’s certain, though, is that a considerable share of crypto online sales volume will come from cross-border, which represented 27% of Latam’s volume in 2023 and will account for 24% in 2026.
Digital goods?
Alongside the current darlings of Latin America’s online sales landscape, other digital goods segments remain strong – and also rising. Retail’s strength in the region should not be overlooked, since the vertical rises faster in Latam than in other regions, with a CAGR of 21%, versus 15% in Africa and 11% in the US – and, with a volume of almost US$ 260 billion, remains the region’s largest e-commerce market.
That level of maturity, though, makes it much harder for cross-border merchants to compete with domestic giants – foreign retail merchants have been particularly successful in Chile and Mexico, which have a cross-border retail share of 25% and 22%, respectively. A particularly interesting segment for foreign merchants in Latam is gaming, which has a cross-border rate of 34% in 2023, expected to rise to 38% by 2026.
To go even further than what we present here, download the complete white paper for free by clicking here and dive into all the insights, exclusive data, and current and future trends we reunited for you in the full study.
Join us for our first webinar of the year on January 23rd!
PagSeguro's Managing Director Caio Costa and PCMI's Managing Director Lindsay Lehr will share both big-picture insights and detailed data designed to feed the strategy development of payments players, such as: