Latin America sees the rise of digital payments apps in the country. The tech-savvy adopters are the main reason for the rise. Aron Schwarzkopf, CEO of Khushki is calling it the “grandma test”.
It’s not only the young adopters; even the grandma generation is adopting the change. The older generation of people is accepting digital payments for transactions. The easier user interface invites the number of people to these apps. Banking and payment became more comfortable.
81% of Latin Americans didn’t use credit cards in 2022. And, almost 45% hold no bank accounts. With the pandemic, 40 million new customers enrolled in financial services. The encouragement comes from government-funded pandemic support.
Local payments account for 83% of digital payments. And, 60% of eCommerce transactions in the region depend on the installments. Digital shopping leads to increased revenue generation for eCommerce sites. And, expects a 30% growth of buyers in LatAm regions by 2024.
Schwarzkopf is calling these numbers just a start. It represents the unleashed potential for digital payment in Latin America. All the FinTechs, banks, and infrastructure will serve as tools in the development.
He also warns that it is not going to be smooth. Latin America is in year one of digital transformation. There will be obstacles around the way. Fragmentation is one of the reasons.
Latin America includes different underwriting, regulatory, and mandates. It aims to link the diverse players inside and outside. The public and Private sectors aim to jointly work to connect consumers.
Local banks will benefit from the digitization of the account. People will transact for the domestic market and others. They can use different ranges of payment.
In order to reduce fragmentation, the Khushki platform will act as a gateway. It will provide service to the local and cross-border payments. Most of the service providers are at the initiation stage. The digital payment app aims to bring the payment digitization revolution.