Boston – May 28, 2014 – Definitions of “unbanked” and “underbanked” consumers and estimates of their number vary widely around the world. Yet there is broad consensus in the banking and payments industry that this demographic will prove important to long-term growth in electronic payments in both developed and developing payments markets.
According to Mercator Advisory Group estimates, in 2013 there were approximately 170 million unbanked or underbanked adults in South America. This means financial institutions have significant incentive to improve financial inclusion and to support the growth of electronic payments around the continent. Increasing the number of consumer bank accounts is not feasible overnight. But across South America both private and public sector organizations are seeking to accelerate the migration from traditional payment instruments to e-payments as a means to tap into a vast new demographic that holds the potential for long-term robust growth across payment industry segments.
Mercator Advisory Group’s report, Unbanked and Underbanked Consumers in South America: A Market for E-Payments, sheds light on the unbanked and underbanked landscape in South America by providing information on the true extent of these in each country across the continent and describing how local public and private organizations are attempting to improve financial inclusion and boost electronic payment use.
“As the global payment industry has grown, firms have begun seeking new international markets where the potential for robust electronic payment growth is emerging. Countries in South America are becoming more attractive as local economies mature and consumers begin the transition from traditional payment instruments to e-payment methods. Similar to other regions around the world that contain a number of developing countries, South America is home to large numbers of unbanked and underbanked consumers. For the most part these consumers operate outside of the electronic payments ecosystem and subsequently miss out on the inherent benefits that electronic payments can bring to the local economy,” comments Tristan Hugo-Webb, Associate Director, International Advisory Service at Mercator Advisory Group and the primary author of the report.
This report contains 26 pages and 13 exhibits.
Companies mentioned in this report include: Azteca, Banco BBVA, Banco Bradesco, Caixa Econômica Federal, Claro, MasterCard, Novo Payment, Oi Carteira, Pagtel, Rapiplata, Ria Financial Services, Scotiabank, Vivo, Wanda, Yellow Pepper
Members of Mercator Advisory Group’s International Advisory Service have access to these reports as well as the upcoming research for the year ahead, presentations, analyst access, and other membership benefits.