Mexico POS Terminals Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

Mexico POS Terminals Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The Mexico POS Terminals Market is expected to register a CAGR of 10.63% over the forecast period (2022-2027). The COVID-19 pandemic created a demand for contactless payments, increasing the need for POS terminals equipped with NFC, RFID, and other technologies accepting payments from contactless chip cards or digital interface cards.

• The usage of cards to make payments is expanding, as seen by transactions at POS terminals (with growth that is much greater than the cards used); in other words, both credit and debit cards are being used more often. This may be considered to be one of the biggest shifts in Mexicans' payment practices.
• The market for mobile POS terminals in Mexico is expanding significantly, mostly due to the region's growing reliance on digital platforms and e-commerce tools. For instance, According to the Mexican Association of Online Sales (AMVO), the 2022 Hot Sale, which was conducted from May 23 to 31, had a record expenditure of MXN 23.4 billion (USD 1.17 billion), up 25.2% from 2021.
• The need for POS terminals in Mexico is also being driven by an increase in company investment in technical advancement to supply secure payment solutions, as well as increased usage of mobile wallets and cloud apps. As per the PYMNTS news report, the value of all digital transactions in Mexico is predicted to increase significantly over the next few years, from USD 54 billion in 2021 to USD 90.1 billion in 2025. Digital wallets are the preferred digital payment option among Mexican consumers, accounting for 19% of all payments, but they are far behind credit and debit cards, which account for 47% of all transactions.
• The demand for POS terminals in Mexico will also increase in the upcoming years as a result of government initiatives like the integration of e-wallets and seamless payments for domestic, cross-border, and foreign exchange transactions as well as efforts by central banks to introduce new digital technologies.
• However, security concerns over data leaks might impede industry expansion. It is crucial for restaurants to protect their customer data. Restaurant point-of-sale systems frequently draw the attention of cyber attackers because they are a hotspot for valuables, including significant sums of money and important customer information. For instance, one of the major restaurants in Mexico, LMBOL & Pitamoni, has chosen Deliko Security systems to secure customer data.
• The effects of the pandemic, have changed traditional ways of thinking, motivating customers to abandon cash in favour of debit or credit cards. Data from Mexico's National Institute of Statistics and Geography (INEGI) showed how quickly the country has moved away from using cash; the percentage of the population making card payments increased from 12 percent before the outbreak to 52% by the end of 2021. The transition towards a cashless economy has deeply influenced the demand for POS terminals in the country.

• According to Ebanx, a prominent international financial organization, Mexico's entire online sales volume is 65% by card payments. Debit cards are increasingly popular since a significant portion of the population lacks access to credit cards. Currently, 134 million debit cards are in use compared to 30 million credit cards, or over 4.5 debit cards for every credit card in the country.
• Major market players are concentrating on card innovations while focusing on Mexico's payment trends. For instance, in June 2022, BBVA Mexico, a prominent Mexican financial institution, announced that the credit and debit cards from BBVA Mexico are upgrading with biometrics, printed data removal, and recyclable plastic. The new Aqua cards employ dynamic CVVs instead of printed card numbers or expiration dates.
• Additionally, the cards will include fingerprint readers so that customers may make contactless purchases of any amount at the point of sale without having to input a PIN. Finally, the cards help the Spanish lender make sure all of its cards are ecologically friendly by 2023 because they are constructed with up to 86% recycled material.
• From January to March 2022, the operations in POS transactions with debit cards hold a share of about 66.6%, while the remaining is the share of credit cards. The debit card POS transactions are valued at around MXN 426.782 billion. The valued amount represents a significant share of global POS transactions, indicating that POS terminals are widely used in Mexico as one of the most preferred payment methods.
• Despite increasing usage of credit/debit cards and cashless payment methods, Mexico is still a country where cash is still dominant. Payment in pesos may be necessary at some petrol stations, convenience stores, open-air markets, and even some museums.

• Most of the new retail enterprises in Mexico are adopting POS terminals at various business locations to enhance the customer experience. For instance, in August 2021, PredictSpring, a provider of modern point-of-sale technology, announced that Steve Madden LTD., a prominent creator and marketer of stylish shoes, accessories, and clothing for women, men, and children, has chosen PredictSpring's Modern POS to give customers a seamless shopping experience no matter where or when they interact with the brand. Additionally, the omnichannel commerce platform from PredictSpring will be included in the retail locations of Steve Madden Mexico, providing a better in-store experience and tying together the customer journeys for online and in-store customers.
• Mexican companies must now provide customers with advanced POS terminal payment options both in-person and online. Competition has grown as more businesses enter the market, and retailers realize that in order to differentiate themselves, they must provide appealing payment experiences. For suppliers of POS terminals like Ingenico, WizarPOS, VeriFone, and many others, this trend creates an opportunity.
• As per Bank of Mexico, 907,854,709 transactions were carried out using cards in retail in 2021, a rise of 14.25% over the previous year, 2020. This represents a large value creation in the total market for retail payments in POS transactions.

The Mexico POS Terminals Market is moderately competitive, with a considerable number of regional players. The companies are leveraging strategic collaborative initiatives, and investments to increase market share and profitability.

• May 2022 - Tauros, a Mexican bitcoin exchange, and IBEX Mercado have partnered up to launch Mexico's first Lightning-enabled exchange. Users of Tauros will have virtually instantaneous settlement and reduced costs when interacting with Lightning-enabled POS systems via their wallets. Anyone utilizing Tauros will also be able to deposit or withdraw money almost instantly using the IBEXHub, IBEX's Lightning-as-a-Service technology.

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support