eCommerce and online payments in Brazil, the Latin America’s leader
17. September 2013
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Nearly 31.6 million Brazilians will purchase online at least once in 2015
With a population approaching 200 million and a booming economy,Brazil accounts for 59% of all B2C E-Commerce sales in Latin America, followed by Mexico with 14%. E-Commerce sales have increased strongly in recent years, and reached 26 billion EUR in 2012. The growth in the number of online shoppers in Brazil is expected to continue, reaching 32 million in 2015.
Even though less than 40% of Internet users in Brazil made online purchases, 62% of those who do shop online made a purchase at least once a month in 2012. Many Internet users want to have the product immediately or want to be able to touch and feel the product prior to making a purchase. However, ongoing improvements of the ecosystem necessary for online retail, such as payment options, anti-fraud protection, delivery system enhancement and other factors are expected to entice more Brazilian Internet users to become online shoppers.
A couple of other trends are converting Brazilian Internet users into shoppers. Social networks are extremely popular in Brazil, as 87% of Internet users are members of at least one social network, more than the worldwide average of 70%. As a result, online retail is also becoming more social in Brazil, where approximately 30% of Internet users follow retailers online. Group shopping is a popular phenomenon in Brazil, where 61% of online shoppers are familiar with the concept and 49% of them have conducted purchases on group shopping websites. Of the individuals that have purchased goods or services from group shopping sites, 82% intend to do so again in the future.
Another factor contributing to Brazil's lead in E-Commerce is the high mobile phone penetration. Mobile devices are the second most used way in Brazil to go online, and 79% of consumers in Brazil use their mobile phones in at least part of the purchasing process. Because of the increasing use of mobile devices for shopping, the Central Bank, in conjunction with Anatel (National Telecommunications Agency) and the Ministry of Communications, proposed legislation, published by the government in May as MP 615 to clarify the roles of government agencies in facilitating the move of Telecoms into the payments picture.
Online purchases in Brazil have until recently been paid for with credit card and boleto bancario (a bank transfer), but mobile payments are expected to become another factor in the continued growth of E-Commerce in Brazil.
Related to card and payment methods in Brazil, an article of Card and Payments World developed in cooperation with yStats.com, says that it is one of the world's largest card payments markets, where 687 million network-branded cards are currently active, and the market continues rapid growth while undergoing fundamental change. The ending of exclusive acquiring agreements with the two major international card networks, Visa and MasterCard, resulted in declining merchant discount rates and increasing competition. Further, retailers are forming partnerships with banks to issue cobranded cards, increasing the competitive pressure in the market.