Mexico Digital Payment Market Overview, 2029

Mexico Digital Payment Market Overview, 2029

Mexico's transition to digital payments is relatively new in comparison to more developed countries. The Sistema de Pagos Electrónicos Interbancarios (SPEI) was introduced in 2004 to facilitate interbank transfers, but widespread adoption was gradual. The debut of CoDi (Cobro Digital) in 2019 marked a significant shift. CoDi pushed real-time payments using QR codes and contactless technologies, which marked a significant leap in Mexico's digital payment ecosystem. Despite developments, cash remains the dominating means of transaction in physical establishments, owing partly to Mexico's vast unbanked population, which stands at over 65%. Nonetheless, there is a notable cultural movement toward digital payments, particularly among young people and in urban areas. Furthermore, e-commerce transactions exhibit higher rates of digital payment usage. The COVID-19 pandemic has hastened the spread of digital payments in Mexico. As individuals sought safer, contactless payment options, the popularity of digital payment systems grew. Furthermore, the rapid expansion of e-commerce during the pandemic increased demand for digital payments, emphasising their significance in today's increasingly digital economy.

According to the research report ""Mexico Digital Payment Market Research Report, 2029,"" published by Actual Market Research, the Mexico Digital Payment market is predicted to grow with more than 15% CAGR from 2024 to 2029. Several factors contribute to the momentum toward digital payments in Mexico. The government aggressively supports their use through initiatives such as CoDi, which seek to move to a cashless economy. Furthermore, rising smartphone usage, increased internet access, and initiatives to boost financial literacy are moving the market ahead. However, issues persist. Security concerns, scepticism of digital platforms, and poor infrastructure in rural areas all provide substantial barriers to wider use. The Banco de Mexico is a key player in creating the digital payment ecosystem by enacting policies and regulations. Measures like shortening the account opening procedure and supporting platform interoperability are intended to enhance financial inclusion and competition while ensuring transaction security. These measures represent a concentrated endeavour to modernise Mexico's financial infrastructure. This rapid expansion demonstrates Mexico's rising embrace of digital transactions, which is being driven by reasons such as technology advancements, altering consumer preferences, and increased smartphone and internet connectivity. Marketers and advertisers in Mexico's fintech sector rely largely on digital techniques to reach consumers. Using social media channels, influencer marketing, and targeted campaigns, fintech companies may effectively engage with various customer segments, increasing awareness and adoption of their products and services.

The provision of solutions and services in the realm of digital payments encompasses a comprehensive array of technologies and processes designed to facilitate electronic transactions, money transfers, and financial activities across digital channels such as the internet or mobile networks. These solutions are instrumental in creating an ecosystem that ensures secure, convenient, and efficient digital payments. Transactions can be categorised based on their type, with domestic payments referring to transactions conducted within a country's borders, while cross-border payments extend beyond national boundaries. Payment modes offer diverse options for users, including cards (plastic or virtual), ACH transfers, digital wallets (e-wallets or mobile wallets), and other methods like contactless payments, biometric payments, and bank transfers. These modes cater to various preferences and needs of users, ensuring flexibility and accessibility in conducting financial transactions. Moreover, digital payment solutions serve a wide range of industries and end-user verticals, including Banking, Financial Services, and Insurance (BFSI), healthcare, IT & telecom, media & entertainment, retail & ecommerce, transportation, and others. Each industry sector benefits from tailored digital payment services that streamline transactions and enhance operational efficiency. In essence, the digital payment landscape thrives on the diversity and adaptability of its solutions and services, catering to the evolving needs of users and industries alike in an increasingly digital world.

Pricing structures in Mexico's digital payment landscape vary depending on the payment method and supplier. Merchants are often charged transaction fees ranging from 1.5% to 3.5%, with additional charges for specialised services. Furthermore, the market serves a diverse range of segments, meeting the demands of people, small and medium-sized businesses (SMEs), and major organisations alike. Payment services are tailored to meet the specific needs of these groups, ensuring accessibility and relevance across a range of business sizes and consumer demographics. The Mexican digital payment business has a dynamic ecosystem that includes both established players and growing competitors. Fintech entrants, in particular, are making significant inroads with innovative solutions, adding to market diversification and encouraging healthy competition. This mix of established incumbents and dynamic entrants demonstrates the vitality and potential of Mexico's digital payment environment, which promises continued evolution and innovation in the coming years.

In 2021, Mexico saw a substantial growth in CoDi transactions, reaching 2.5 billion Mexican pesos, a 600% increase over the previous year. This rise highlights the growing acceptability and usage of digital payment alternatives inside the country. Such a significant increase suggests a shift in customer behaviour toward more convenient and efficient payment methods, aided by technological improvements. Building on this momentum, the Mexican government announced in 2022 ambitious intentions to invest USD 5.2 billion in financial inclusion programs. This strategic initiative demonstrates the government's commitment to increasing access to financial services nationwide, particularly among marginalised people. Mexico's goal in investing in financial inclusion is to empower individuals and businesses, promoting economic growth and stability. Mexico took more efforts in 2023 to promote innovation and competition in the fintech sector by reducing rules. This move aims to create a more hospitable climate for fintech startups and established businesses to thrive, resulting in increased innovation and customer choice. Streamlining laws may also attract investment and expertise, establishing Mexico as a regional leader in fintech innovation. Despite these developments, Mexico remains behind developed countries such as the United States and Canada in terms of digital payment acceptance. However, the strong growth trajectory indicates that Mexico is making great progress toward closing this deficit. Mexico is on track to reduce this discrepancy even further in the coming years as digital payment infrastructure expands and consumer acceptance grows.

Considered in this report
• Historic year: 2018
• Base year: 2023
• Estimated year: 2024
• Forecast year: 2029

Aspects covered in this report
• Digital Payment market Outlook with its value and forecast along with its segments
• Various drivers and challenges
• On-going trends and developments
• Top profiled companies
• Strategic recommendation

By Offering
• Solutions
• Services

By Transaction type
• Domestic
• Cross Border

By Payment Type
• Cards
• ACH Transfer
• Digital Wallet
• Other Payment Modes

By Vertical
• BFSI
• Healthcare
• IT & Telecom
• Media & Entertainment
• Retail & E-commerce
• Transportation
• Others

The approach of the report:
This report consists of a combined approach of primary and secondary research. Initially, secondary research was used to get an understanding of the market and list the companies that are present in it. The secondary research consists of third-party sources such as press releases, annual reports of companies, and government-generated reports and databases. After gathering the data from secondary sources, primary research was conducted by conducting telephone interviews with the leading players about how the market is functioning and then conducting trade calls with dealers and distributors of the market. Post this; we have started making primary calls to consumers by equally segmenting them in regional aspects, tier aspects, age group, and gender. Once we have primary data with us, we can start verifying the details obtained from secondary sources.

Intended audience
This report can be useful to industry consultants, manufacturers, suppliers, associations, and organizations related to the Digital Payment industry, government bodies, and other stakeholders to align their market-centric strategies. In addition to marketing and presentations, it will also increase competitive knowledge about the industry.

Considered in this report
• Historic year: 2018
• Base year: 2023
• Estimated year: 2024
• Forecast year: 2029

Aspects covered in this report
• Digital Payment market Outlook with its value and forecast along with its segments
• Various drivers and challenges
• On-going trends and developments
• Top profiled companies
• Strategic recommendation

By Offering
• Solutions
• Services

By Transaction type
• Domestic
• Cross Border

By Payment Type
• Cards
• ACH Transfer
• Digital Wallet
• Other Payment Modes

By Vertical
• BFSI
• Healthcare
• IT & Telecom
• Media & Entertainment
• Retail & E-commerce
• Transportation
• Others

The approach of the report:
This report consists of a combined approach of primary and secondary research. Initially, secondary research was used to get an understanding of the market and list the companies that are present in it. The secondary research consists of third-party sources such as press releases, annual reports of companies, and government-generated reports and databases. After gathering the data from secondary sources, primary research was conducted by conducting telephone interviews with the leading players about how the market is functioning and then conducting trade calls with dealers and distributors of the market. Post this; we have started making primary calls to consumers by equally segmenting them in regional aspects, tier aspects, age group, and gender. Once we have primary data with us, we can start verifying the details obtained from secondary sources.

Intended audience
This report can be useful to industry consultants, manufacturers, suppliers, associations, and organizations related to the Digital Payment industry, government bodies, and other stakeholders to align their market-centric strategies. In addition to marketing and presentations, it will also increase competitive knowledge about the industry.