Payments Landscape in Mexico: Opportunities and Risks to 2021

Payments Landscape in Mexico: Opportunities and Risks to 2021

  • October 2017 •
  • 56 pages •
  • Report ID: 5164865
Payments Landscape in Mexico: Opportunities and Risks to 2021

Summary
Cash remains the preferred form of consumer payments, especially among the rural population, primarily due to limited knowledge of payment cards or limited access to banking infrastructure. Cash is primarily used for making small-value payments at retailers, and for the payment of utility bills, taxes, and transport fares. A significant proportion of the population is engaged in informal activities, including farmers, street vendors, domestic servants, and self-employed workers. The payment card market is growing strongly but not explosively, and the current trends make a major shift in the near future unlikely. Various charges on cards and bank accounts have also reduced the appeal of payment cards for most Mexican consumers.

Mexico joined the UN’s “Better Than Cash Alliance” in June 2016. The move came after the government introduced a national policy on financial inclusion to promote the use of electronic payments across the country, and reducing dependence on cash. With 86% of the 124.6 million population owning mobile phones, Better Than Cash Alliance aims to harness the popularity of mobile phones for digital payments.

Uptake of alternative payments is gradually increasing in Mexico, with banks launching new solutions in the market. In partnership with Mastercard, Banamex launched its digital wallet, Banamex Wallet, in February 2016. The Android-compatible mobile app can be used to make contactless m-payments, which are authorized by a four-digit PIN. Users can add all Mastercard-branded credit cards to the wallet. Earlier in June 2014, BBVA Bancomer launched its mobile wallet BBVA Wallet in Mexico. The wallet allows secure NFC payments at merchant locations that accept contactless payments. Available on phones with Android 4.4 and above, other phones can use the wallet through NFC stickers.

Banks and scheme providers in Mexico have also moved into the e-commerce space to benefit from this upward trend. In November 2015, Visa launched Visa Checkout in Mexico. This service enables shoppers to make online purchases using a smartphone, tablet, laptop, or PC without having to leave the merchant’s website in order to complete the purchase. In December 2016, BBVA Bancomer acquired Openpay, one of the largest online payment gateway providers in Mexico. Openpay enables merchants to accept payments for purchases through various payment methods such as debit and credit cards and bank transfers.

The report "Payments Landscape in Mexico: Opportunities and Risks to 2021", provide top-level market analysis, information and insights into the Mexican cards and payments industry.

Moreover, this report provides the following -
- Current and forecast values for each market in the Mexican cards and payments industry, including debit, credit, and charge cards.
- Detailed insights into payment instruments including credit transfers, direct debit, cheques, cash, and payment cards. It also, includes an overview of the country’s key alternative payment instruments.
- E-commerce market analysis and payment methods.
- Analysis of various market drivers and regulations governing the Mexican cards and payments industry.
- Detailed analysis of strategies adopted by banks and other institutions to market debit, credit, and charge cards.

Companies mentioned in this report: BBVA Bancomer, Banco Santander, BanCoppel, Citibanamex, Banorte, Nacional Financiera, HSBC, Visa, Mastercard, American Express

Scope
- To further enhance financial inclusion, Mexico joined the UN’s Better Than Cash Alliance in June 2016. The move comes after the government introduced a national policy on financial inclusion to promote the use of electronic payments across the country and reduce the dependence on cash. With 86% of the 124.6 million population owning mobile phones, Better Than Cash Alliance aims to harness the popularity of mobile phones for digital payments.
- The uptake of alternative payments is gradually increasing in Mexico, with banks launching new solutions in the market. In partnership with Mastercard, Banamex launched its digital wallet, Banamex Wallet, in February 2016. The Android-compatible mobile app can be used to make contactless m-payments, which are authorized by a four-digit PIN. Users can add all Mastercard-branded credit cards to the wallet. Earlier in June 2014, BBVA Bancomer launched its mobile wallet BBVA Wallet in Mexico. The wallet allows secure NFC payments at merchant locations that accept contactless payments. Available on phones with Android 4.4 and above, other phones can use the wallet through NFC stickers.
- To combat fraudulent payment activities in Mexico, banks and scheme providers are taking a number of measures, with one example being Mastercard’s introduction of the Identity Check Mobile solution in November 2016. The solution allows card holders to verify online payment by scanning their fingerprint or taking a selfie. Unlike existing identity verification methods - which take shoppers away from a merchant’s website or mobile app and often require them to remember and enter a password - Mastercard Identity Check Mobile verifies the user via technologies such as biometrics and one-time passwords. Earlier in January 2015, Oberthur Technologies (OT) partnered with Mexican payment processing services provider Promocion y Operacin SA (PROSA) to launch OT Motion Code technology. With Motion Code the card’s CVV code is replaced with a mini-screen on which the CVV code changes automatically at regular intervals, making it impossible for fraudsters to misuse.

Reasons to buy
- Make strategic business decisions, using top-level historic and forecast market data, related to the Mexican cards and payments industry and each market within it.
- Understand the key market trends and growth opportunities in the Mexican cards and payments industry.
- Assess the competitive dynamics in the Mexican cards and payments industry.
- Gain insights into marketing strategies used for various card types in Mexico.
- Gain insights into key regulations governing the Mexican cards and payments industry.
Country=Mexico Industry=Payments ParentIndustry=Services Date=201710 Topic=MarketSize Publisher=GlobalData Price=3000