The importance of cash payments in Argentina
A little piece of Europe in the middle of South America. This is how some may describe Argentina, the eighth largest country in the world, with its vibrant culture and pulsating digital economy. The promising market is expected to grow at rate of 24% until 2021 as already described here our blog, but this post is all about cash payment as a crucial tool to increase ecommerce sales in the country.
According to the Ecommerce Payment Methods Report, published in 2016 by The Paypers, this is not exclusive to Argentina. Cash payments are still a big hit in other South American countries since bank account and cards (credit and debit) penetration represents only 50% of the population. “It means that, without cash options, nearly half the Latin American population would struggle to gain access to the ecommerce world. This is in stark contrast to European countries such as the Netherlands and Sweden where the share of cashless online and offline purchases make up more than 90% of the total consumer market”, describes the report.
When offline payments are available, digital business can gain access to a huge base of new potential buyers. This process works similar to boletos in Brazil and OXXO in Mexico, connecting both online and offline realities. It embraces consumers and brings them to the online economy, creating new opportunities for companies to reach a wider audience in these countries.
Buying at local shops, subscribing for services via websites and purchasing tourism packages for holidays are all much easier with this payment solutions. In Argentina specifically, cash payment can be a powerful strategy for merchants. “If an international company wants to truly enter Argentina, local cards with installments and cash payments like Rapipago or Pagofacil need to be offered, period”, explains BoaCompra Payments Director, Fernando Estevez.