If you look closely at any merchant's ecommerce operation, you will see that there are probably more than 12 card-acceptance platforms mingled together to serve different regions of the globe with banks partners who do payment settlements or manage foreign exchange.
Latin American companies face the additional challenge of processing transactions that aren't card-based. This includes bank transfers, emerging payments, and cash-based payments that require electronic confirmation.
A merchant may need 50-100 partners depending on the complexity of their business and the country they are trying to target. A transaction that fails to complete all transactions across multiple platforms within a fraction of a second could result in huge losses.
Online merchants require a new breed infrastructure fintechs
Global merchants and service providers must eliminate the friction associated with payments and online shopping. This will help them grow their market share and loyalty.
The payments landscape in Latin America is a daunting challenge for global merchants looking to expand to the region. This includes Amazon, Amazon, Shopee, and Shopee, who are all e-commerce giants, as well as tech giants like Garena, Netflix, or WhatsApp. There are 14 currencies in South America.
There are over 30 countries in Latin America and the Caribbean. Each country has its own customs, financial regulations, and consumer protections. Global acquirers are unable to recognize the credit scores of many Latin Americans, which can lead to high rates of unapproved transactions.
MercadoLibre is the regional e-commerce leader in Latin America. It has surpassed a market capital of $90 billion earlier this years, despite their rapid advancements. Will Healy, a Nasdaq analyst of MeLi’s latest earnings report, outlines the key advantages LatAm's current ecommerce leader. These include its investments in both shipments as well as payments and its "secret weapon" in Mercado Pago, which facilitates electronic payments in cash-dependent markets.