China and India: The Most Advanced in Payment Technologies

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China and India are the most advanced in terms of cross-border payment technology and providing options to consumers to make the process as friction-free as possible, according to global payments provider Worldpay.

Olann Kerrison, Vice President, FX and Global Payment Products at payments provider Worldpay, said Chinese consumers have a plethora of payment options including Alipay, WeChat Pay and Union Pay, representing 90% of ecommerce volume.

India is also making big strides in terms of payments and consumer behavior, Kerrison said. This is due in large part to efforts by the Indian government to execute Paytm, an ecommerce payment system developed by a private Indian company.

Walmart CEO Doug McMillon said he remains optimistic about the Indian ecommerce opportunity given the size of the market.

“It’s the low penetration of ecommerce and the retail channel and the pace at which it’s growing,” said McMillon on an analyst call. “In the future, we hope to work with the government for pro-growth policies that can allow this nascent industry and the domestic manufacturers, farmers and suppliers to benefit from it develop and prosper.”

Kerrison said Brazil has the biggest ecommerce market in Latin America, growing significantly in the last few years to reach $27.6 billion in 2018, according to Worldpay’s Global Payments Report 2018.

“Increasing improvements in technology and rising online and mobile penetration have resulted in enhanced consumer confidence in online transactions,” said Kerrison of Brazil.

Kerrison said mobile commerce in Brazil accounts for almost a third of all ecommerce transactions, growing at a 54% CAGR between 2014 and 2018. It’s expected to reach $18 billion by 2022.

“Legislative initiatives and the advent of digital-only banks are fueling the shift toward electronic payments,” he said.

In an effort to increase financial inclusion in the country, the Brazilian government passed Resolution 4,480 in 2016, requiring banks to let consumers open accounts using electronic channels.

In Brazil, credit and debit card use accounts for 62% of total ecommerce transactions and 44% of POS transactions, according to Worldpay’s report. The widespread use of installment payments is helping to keep credit cards at the top of the list of preferred payment types in online shopping.

Kerrison said Boleto Bancário helps serve Brazil’s unbanked population. This segment however, is shrinking, according to World Bank statistics.

“Brazil has made progress in terms of financial inclusion, with the percentage of the Brazilian population age 15 or above with a bank account increasing from 68.1% in 2014 to 70.4% in 2018,” he said.

Canada and the UK were the most popular countries to sell into for cross-border merchants, according to the 2019 MCM Outlook survey, cited by 50% of respondents, followed by Mexico, Australia, Italy, France, Germany and Sweden, each with 25%.

To learn more about the global payment landscape, you can download our new MCM Ecommerce Report: How to Master Your Global Payments Strategy by clicking here.

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