Rising markets across Latin America, Africa, and Asia present substantial growth opportunities and prospects as an estimated of 109 million people will be joining the global consumer class in 2024, according to a research report by global fintech firm EBANX.

Out of the 109 million people, 70 percent will come from these regions, according to the World Data Lab.

Over the next decade, Africa will add more consumer spending than Europe, India is to become the world’s third-largest economy, and Latin America will reach nearly universal internet penetration, EBANX’s report, Beyond Borders 2024 showed.

“There is a clear demographic reason for this trend: rising economies have a young and growing population (in contrast with developed regions). Africa will be home to the largest adult population worldwide by 2030, with over 1 billion working-age people. India is expected to reach the same threshold by 2025, surpassing China,” the report noted.

The effect of rising income should not be forgotten, as well: in Latin America, for example, the higher income level will be twice as important as the number of new consumers through 2030, per the World Data Lab. This means that most of the new spending in the region will come from actual consumers, who are seeing their economic status improving gradually over time, the report added.

In addition to the demographic and economic push, rising economies greatly benefit from digitization, the report noted. As internet access becomes more widespread, consumers and businesses get digitized, disrupting traditional industries and lowering entry barriers both for companies and users.

Based on the report, it is also worth noting that rising markets are nurturing their own digital titans — which are increasingly competing with global companies.

For global companies, rising economies represent an enormous growth opportunity, especially for digital businesses. Digital industries across the world have reached a plateau, with high levels of competition and user penetration. Most of them grow only around 2 percent per year, in a typical scenario of market saturation. The one exception is rising markets, the report added.

International players are rising to the occasion as cross-border transactions grow. Judging by the numbers, there is room for everyone. International purchases make up a significant share of digital commerce in rising economies, especially in nascent markets in Latin America — where cross-border transactions can reach up to 74 percent of total online purchases, per PCMI (Payments and Commerce Market Intelligence). Cross-border transactions are also relevant in major economies such as Mexico, Chile, and South Africa, with about 20 percent share.

Digital commerce as a whole is accelerating fast in rising markets, growing at a 23 percent rate per year in Latin America by 2026, 24.9 percent in Africa, for instance, per data from PCMI. This is much faster than the US (13 percent) or Europe (12 percent) as a whole.

In an interview with TNGlobal, Wei Duan, Vice President for APAC at EBANX, shared some of the observations and experiences of EBANX in rising markets.

EBANX was established in 2012 in Brazil during a period when digital commerce was in its early stages in the country, including cross-border digital commerce, Wei said.

At that time, global companies were also just beginning to enter the digital commerce market in Brazil – one of the challenges, for example, was addressing the needs of customers in the country who sought to pay for their orders in Asian players using “boleto” – a native, local payment method that allowed people to pay for digital purchases at a physical location, using physical money.

The challenge was very aligned to EBANX’s purpose: simplifying and expanding access to Latin American markets (and later including Africa & India) for global businesses, so that customers in these markets could reach products and services from around the world.

More developed countries’ payment markets have matured at a different pace, and often have a relatively singular ecosystem. In the European and North American markets, especially in the U.S., credit cards are the dominant payment method. In Europe, there is a certain balance between credit cards and local payment methods.

However, the uniqueness of Latin American markets, including Brazil, African markets and India, lies in the fact that the countries that form these regions have varying cultural behavior and consumption habits. Many people in these regions do not possess credit cards or even bank accounts, and many of them prefer to use native, local payment methods.

Therefore, when venturing into rising markets, payment methods become more diverse, or one could say fragmented, Wei noted.

“At EBANX, we have the capability to comprehensively cover the payment needs of diverse demographics in rising markets. We can support card-based payments, as well as local, unique payment methods, and even cash payments. This enables the merchants we serve to have a full spectrum of payment solutions when entering and expanding into rising markets. EBANX’s clients, which can go from SaaS companies, to streaming, gaming, e-commerce, or travel, can flexibly choose from different payment options to reach different target audiences and customers,” Wei added.

Localized solutions & services to cater to different needs

There is no one-size-fits-all payment solution for rising regions. To cater to the unique requirements of each country, EBANX has undertaken the integration of an extensive array of payment methods into its platform. This comprehensive approach is facilitated by the use of a single API, streamlining the pay-in and pay-out processes for merchants.

By seamlessly incorporating a diverse range of payment options, EBANX also ensures that merchants can effortlessly navigate the intricacies of each local market.

Today, EBANX serves more than 1,600 global digital companies. Some of the largest brands from various industries and verticals, such as e-commerce, gaming, SaaS, streaming, social media, creator’s economy at large, and travel.

“Through our proprietary payments platform, one single API, we enable merchants to reach their audiences in 29 countries across 3 of the fastest-growing digital markets in the world: Latin America & Caribbean, Africa and Asia. By unlocking over 100 local payment methods, with solutions for both B2C and B2B payments, payin and payout,” Wei said.

Noteworthy is the recent inclusion of OXXO PAY, a popular payment method in Mexico, Botón Bancolombia in Colombia, and NuPay in Brazil, three key additions that further enhance the adaptability and accessibility of EBANX’s platform. These integrations underscore EBANX’s commitment to staying at the forefront of payment solutions, enabling businesses from Australia, New Zealand, Singapore, China, Korea, Japan, the US, Canada, UK, Sweden, Spain, France, and so on to connect with a broader customer base and thrive in diverse markets from Latin America, Africa, and India.

According to her, EBANX can also help Indian companies to reach their clients in Latin America and Africa, through EBANX’s platform, and integrate the preferred local payment methods. It is worth noting that 15 percent of the revenue from the 30 leading SaaS companies in India comes from Latin America, and 13 percent from the Middle East-Africa, per a Zinnov analysis.

“Besides the SaaS industry, India is also a major exporter of IT services. We are able to integrate companies from these verticals to Pix in Brazil, OXXO PAY in Mexico, mobile money in Kenya, and so on,” Wei told TNGlobal.

Suggestions for companies looking into emerging markets

Asked about the suggestions Wei has for companies looking into emerging markets, Wei listed out three high-level suggestions:

• Recognize and appreciate the extensive opportunities that these rising economies present for businesses and entrepreneurs from Asia and Oceania. Understand the unique economic landscapes, untapped consumer bases, and growing industries within these regions.
• Tailor strategies and approaches for each country by gaining a deep understanding of its distinct characteristics and unique consumer behaviors. Consider factors such as cultural nuances, regulatory environments, and market trends specific to each nation. Customize marketing, product offerings, and business operations to align with the preferences and demands of the local population, ensuring a more resonant and effective market entry.
• Seek out and establish partnerships with local entities capable of addressing practical challenges prevalent in each market. Identify partners who possess a thorough understanding of the local business landscape, regulatory frameworks, and consumer dynamics. Collaborate with these local partners to gain valuable insights and strategic recommendations.

EBANX is the leading payment platform connecting global companies with customers from the fastest-growing digital markets in the world. The company was founded in 2012 in Brazil with the mission of giving people access to buy in international digital commerce.
With its proprietary technology and infrastructure, combined with in-depth knowledge of the markets where it operates, EBANX enables global businesses to connect with hundreds of payment methods in different countries in Africa, Asia, and Latin America. EBANX goes beyond payments, increasing sales, and fostering seamless purchase experiences for businesses and clients.

Access the complete Beyond Borders 2024 study here.

This article was written in partnership with EBANX.