Alternative payment methods
Unlocking the Latin American gaming market
August 9, 2024•4 min
Looking to unlock a new gaming market? Look no further than Latin America. With a massive player base and high mobile proliferation, the Latin American gaming market is experiencing significant growth and is ready for game developers to expand their games' reach. To take advantage of this region's potential, it is important to understand the preferred payment landscape and how Xsolla can help you navigate it effectively.
Sourcee: Allcorrect, Statista (Chile, Colombia)
Mobile phone proliferation is high in Latin America, so it makes sense that mobile games are the most convenient way for players to enjoy gameplay. Mobile gaming takes the lead, with 87% of Latin American players using mobile devices over consoles and PCs. Despite the high prevalence of mobile phone use, mobile game titles tend to be simpler, favoring casual game titles due to reliability issues, like slower internet connections. All in all, of the top 6 countries with the highest mobile device use, Brazil leads with 90% of the population having access to reliable internet, with Mexico, Colombia, Argentina, Chile, and Peru at 64%, trailing behind.
Not partnered with Xsolla yet? Curious about how Xsolla can streamline the game publishing process across various platforms and regions? Contact our team of experts today to learn more or set up your Publisher Account to get started today.
Latin America: gaming market overview
Latin America is currently the second fastest-growing games market in the world. Trailing behind the Middle East and Africa, Latin America shows a 3.8% increase in year-on-year growth and accounts for 5% of the global games market, according to a recent study by Newzoo. At the close of 2023, Latin America had 335 million active players and brought in $8.7 billion (USD). The following table shows a breakdown of the top 5 countries contributing to this massive growth. So, what is driving this boom? Mobile games!
Sourcee: Allcorrect, Statista (Chile, Colombia)
Mobile phone proliferation is high in Latin America, so it makes sense that mobile games are the most convenient way for players to enjoy gameplay. Mobile gaming takes the lead, with 87% of Latin American players using mobile devices over consoles and PCs. Despite the high prevalence of mobile phone use, mobile game titles tend to be simpler, favoring casual game titles due to reliability issues, like slower internet connections. All in all, of the top 6 countries with the highest mobile device use, Brazil leads with 90% of the population having access to reliable internet, with Mexico, Colombia, Argentina, Chile, and Peru at 64%, trailing behind.
Latin American payment methods
While the gaming market thrives, payment methods in Latin America paint a more intricate picture. In recent years, there has been a significant shift from cash to digital payments, which are growing in popularity. As a whole, Latin America has historically dealt mainly with cash transactions. Still, bank account ownership has grown substantially, from around 30-50% of the population in 2019 to approximately 73% in 2021. When looking at individual Latin American countries, two main patterns stand out:- Mobile payment leaders: Argentina, Colombia, and Peru have seen increased bank use thanks to mobile payments, in the form of digital wallets and e-payments. Nequi, a popular digital wallet with over 18 million users in Colombia, is a prime example of a solution to help boost Colombia's e-commerce growth, especially among young people.
- Debit card leaders: Chile and Ecuador have focused on getting people to use debit cards to encourage banking. Chile has successfully increased bank account ownership through the government-owned bank, BancoEstado, making it easy for people to get debit cards with its CuentaRUT program, now servicing over 14.5 million Chileans.
Challenges facing the Latin American gaming market
Economic instability creates significant hurdles despite the immense potential of the Latin American gaming market. When looking at the region's GDP, Latin America's economy was much more volatile between 2020 and 2022 than the rest. Economic volatility was measured at 7.2 for Latin America compared to 4 globally and 5 for developed countries. But what accounts for this instability? Morgan Stanley believes that declining economic activity in Latin America is caused by falling commodity prices, money leaving the region, and unstable currencies, as exemplified by Argentina's rapidly increasing inflation, which rose from 13% in November 2023 to 25% in December 2023. Additionally, having an underdeveloped payment infrastructure limits consumer options, especially in regions with low credit card penetration. For developers, this leads to high forex rates and difficulty ensuring that payments reach businesses. To succeed, developers must offer a variety of payment methods that are fast, secure, and localized for the region. Xsolla can help As an international company, Xsolla has the resources and an established presence in Latin America. Our solution, Xsolla Payments, is a well-rounded service that not only offers the safety and security that your new Latin American players are looking for, it also offers seamless integration for your existing game titles. With Xsolla as your trusted partner and merchant of record, easily enter into the Latin American market with,- Popular payment methods include Pix in Brazil, OXXO in Mexico, PSE in Colombia, MACH Pay and Mercado Pago in Chile, PagoEfectivo and Yape in Peru.
- A localized payment interface for both Spanish and Portuguese
- Fraud protection and streamlined chargeback management
- Global digital service tax management from our dedicated tax team
Not partnered with Xsolla yet? Curious about how Xsolla can streamline the game publishing process across various platforms and regions? Contact our team of experts today to learn more or set up your Publisher Account to get started today.Featured articles
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