Payments Flexibility: the future of business in Latin America is hybrid
Hybrid. That's a word we've been hearing a lot these days.
A quick search is enough to discover that hybrid means a blend of different elements. Something heterogeneous in the way it's composed. Cross or mixed.
If you think about it, it has a lot to do with payments flexibility. It is also a good match if we think of Latin America.
Businesses who wish to attend such a diverse set of countries need, of course, customizable solutions - whether they are expanding to the region for the first time or finding new ways to maximize growth in each market.
Keep scrolling to see in what way hybrid choices of payment can help you seize Latin America's full potential for sales results and customer experience.
Payments Flexibility: the pro to Latin America cons
Whether you are considering expanding your business or are trying to find a way to maximize your results within the area, Latin America is complex. No doubt there.
We are talking about a continent distinct in many ways.
Because Latin America is made up of over 20 different countries it may seem tough to navigate, but don’t let that deter you from the plan. Along with all challenges and difficulties, there are many growth opportunities for those who are willing to take the leap.
Below you will find some of the available solutions to the main challenges faced by those who want to grow in one or more countries in the region:
👎You are not physically present there
There is the physical distancing between your headquarters and your local audience. That may be tricky when it comes to maintaining a local presence and offering the same level of customer experience that you do in other markets.
Communicating with an international audience is not always simple, especially considering aspects such as language barriers, shipping costs, hours of operation, and the logistics of each country, area or town.
👍… but local growth pace is impressive
The rate in which people are consuming online and e-commerce volume per country is improving faster on a YoY basis due to increasing digitalization and financial inclusion. Special highlights to digital goods and services, which apparently have made the online experience more comfortable for consumers in LatAm.
Delivery apps such as Rappi increased at a 63% rate in Colombia in 2020 - the country with the fastest growing pace among Brazil, Mexico and Chile.
👎Fragmented conciliation with multiple business models
While investors and international companies will find in LatAm a wealth of opportunities, it is hard for businesses to adapt to the countries' regular jurisdiction and governmental changes. Tax implications, trading laws, specific taxes and fees, legal requirements…
Each country has its own set of affairs and agreements, making it more difficult for companies to adhere to compliance requirements.
👍… but there is also EBANX ONE
A solution that can be tailored according to your needs and operational model, capable of processing transactions in 15 different LatAm countries (and growing) with domestic or international funds settlement, and perform payouts by settling the funds to their partners in an uncomplicated way. Most importantly, all that with or without a local entity and office.
With EBANX ONE, you choose one or more operational models at the same time, in one or more countries, with several payment solutions, with unified conciliation and reports, all within a single platform.
👎Local payment strategy may be tricky
Setting the right price for the right audience, without running the risk of ruining the business. Pricing is challenging no matter the size of your deal. It is imperative to consider several implications to remain competitive and, at the same time, get your profit as planned.
On top of all that we have to deal with exchange operations, transactional reconciliation, and currencies that go from Brazilian real to Peruvian nuevo sol to Uruguayan peso to Bolivian boliviano… well, you get the picture.
👍… but we all want access!
Latin Americans are buying much more online. In fact, Brazilian online card purchases grew over 35% in the first quarter of 2021. The majority of these remote transactions were made with a credit card - which is great for the businesses who need international transactions to work in order to sell abroad.
On the other hand, debit and prepaid card operations have been advancing at a much faster pace. This means that the local audiences do want to buy from your brand, but also need payment flexibility.
👎Your audience is culturally diverse
This is not supposed to be a negative in your operation. Although we are aware it is a real challenge being able to know and understand cultural differences - especially if you are not there.
Thing is: people like different things, prefer different payment methods, and have their own routines and needs. Sometimes it seems impossible to speak their language (preferably their accent, too), and run marketing and sales campaigns that are actually engaging and capable of delivering the results you expect as a company.
👍… but we are here to help
Are you actually just going to ignore the world's fastest-growing e-commerce market? Latin America presented a 36.7% year-over-year growth in 2020.
In 2021, Amazon enabled their customers from Brazil to buy foreign brand items in the same interface they already buy national items. In short, clients can now buy international goods paying local.
You know what? That is not an Amazon-exclusive solution. Your brand could do the same thing.
Yes, doing business in Latin America can be tough. But that does not mean you should give up. It just means you have to find the right partner for the challenge. We do not mean to spoil the end of this story, but the truth is: there is a payments solution for your business right here.
Hybrid is the new black: looking ahead
We've seen some of the main challenges faced by those who are willing to take the leap and invest in Latin America. We've also seen there are some interesting counterpoints to each of them.
What I mean to say is that for every challenge there's an opportunity. And that's where we grow.
If you want to expand and maximize your business' results in one or more of the Latam countries, you'll likely have to embrace the differences and think of ways to offer access and positive brand experience to your new audience.
The secret to that is a change of mindset. Understand your customer.
Think payments flexibility. Think of ways to make their lives easier, to remove friction, and to tailor your offers to their reality. Give access. Think hybrid choices of payment and operational models.
In an increasingly global and digital world the ability to be where your customers are, even if you aren’t there, is powerful and a necessity.
Depending on your business strategy, it might make more sense to double down on a specific market and put less of an emphasis on others. And that's okay.
The good news is that, with a unified platform such as EBANX ONE, you can shape your operation in Latin America the way you judge is best. With a payments flexibility mindset, you wouldn't have to sacrifice experience or quality of your services or customers.
To summon up, here's some of the reasons why we are all in favor of a platform that can be tailored to one or several operational models for your business in Latin America:
• Security for your business compliant with all of Latam regulations
• Access to Latin American consumers through different payment methods
• More positive shopping and brand experience to end users
• Business scalability and growth in Latam countries
• Flexibility to all operational models: payment processing with international funds settlement; payment processing with domestic funds settlement; and payout
• Customization based on your preference and needs
Lastly, we know how time consuming it is for companies to develop their own relationships with acquirers and issuers. The key is a solution that supports this and optimizes your company's unique current and future needs.
That's why we're here for.
What are the key factors you should know in expanding and growing a business in Latin America? Each week we’ll unlock a new content guides to help you navigate the market and localize in the region.