By Diana Arizaleta
Senior Consultant
Digital payments have become an integral part of the financial landscape in Latin America. Accelerated by the COVID-19 pandemic, demographic shifts, and widespread mobile adoption, the region is undergoing a transformation that is reshaping how consumers and businesses engage and manage money. Markets such as Brazil, Mexico, and Argentina lead in scale and maturity, while smaller markets like Colombia, Peru, and Chile are emerging as increasingly important centres of innovation and growth.
For companies operating in (or planning to enter) Latin America’s payments market, the opportunity is there, but so is the complexity. It’s not enough to acknowledge the region’s digital shift; success depends on deeply understanding local dynamics and using those insights to guide strategic decisions.
In my opinion, these are the five key factors to be aware of:
One of the most common mistakes companies make when entering the LATAM market is assuming homogeneity across countries. Each market has its own distinct payment preferences, influenced by regulatory infrastructure, consumer behaviour, and economic context.
In Argentina, for example, digital wallets and QR code payments have seen widespread adoption and have become a key channel for day-to-day purchases. In Brazil, A2A has seen exponential growth, unlike any other LATAM market. In Mexico, cash-based payment methods, and credit cards remain very strong. However, we can see some regional trends such as the rise of digital wallets and of A2A instant payments, fuelled by public sector initiatives.
Understanding this diversity is critical. A digital wallet strategy that works well in one market may underperform in another where instant transfers or card payments are more embedded. Companies need to design offers and experiences with country-specific data in hand, not just regional trends.
LATAM’s payments space is one of the most dynamic in the world, with competition coming from multiple directions. While global players are present, much of the innovation is being driven by local FinTechs and regional disruptors who have a clearer view of on-the-ground needs.
Companies like Nubank in Brazil, Mercado Pago in Argentina, Stori and Konfio in Mexico have achieved rapid scale by solving specific pain points such as offering streamlined onboarding, flexible credit access, and mobile-first design. Meanwhile, regional infrastructure providers such as Kushki are playing a behind-the-scenes role in enabling cross-border and local payments. Traditional banks still serve large portions of the market, but they are increasingly under pressure to match the speed, usability, and relevance of these newer entrants.
To compete effectively, companies need to do more than just benchmark themselves against global players. They must understand what local leaders are doing differently and how those strategies resonate with specific customer segments. Identifying unmet needs, emerging use cases, or underserved niches can create clearer paths to competitive advantage.
In many regions, regulatory changes are seen as barriers to innovation. In LATAM, they are often the opposite. Central banks and financial authorities across the region are actively shaping the future of payments through initiatives that encourage openness, interoperability, and financial inclusion.
Brazil’s PIX system is a prime example: launched by the Central Bank, it has enabled instant, low-cost payments for over 175 million users1 and dramatically changed how consumers and businesses transact. Mexico’s CoDi platform has similar ambitions, promoting instant payments via QR codes and mobile apps, while DiMo promotes payments via telephone numbers. In Argentina regulators are working towards interoperability standards for QR code payments, with digital wallets and credit cards, as well as dual-currency (USD and ARS) card payments
These developments are more than technical changes - they reshape the payment experience and influence user expectations. Financial services companies need to monitor not only how regulations evolve, but also what new opportunities they create. Integrating with government-led platforms, for instance, may enhance trust and usability, while also unlocking access to previously hard-to-reach segments.
One of the clearest signals in the LATAM market is that FinTechs are growing not because of hype, but because they are solving deep-rooted challenges. Many consumers and small businesses have historically been underserved by traditional financial institutions and as such have faced high barriers to entry, limited credit access, and friction-filled onboarding processes.
FinTechs have stepped in with simpler, mobile-first offerings that focus on utility. Consumers gain access to accounts, payments tools and credit without requiring formal credit histories. Small businesses benefit from fast onboarding, localised payment acceptance, and access to working capital through embedded finance.
For companies looking to enter or expand in the region, this is a reminder that growth often comes from solving real, everyday problems. Product design should be informed by user research that digs into what’s missing, what’s broken, and what’s being patched together informally. Incentives, feature sets, and onboarding flows should reflect the lived experience of LATAM’s diverse and often financially excluded user base.
While the region is rich with opportunity, it’s also highly nuanced. Success often hinges on the ability to localise - not just in terms of language or branding, but in how products are built, distributed, and supported.
Rather than taking a broad regional approach, companies should consider narrowing focus to markets where they can achieve relevance quickly, based on infrastructure readiness, customer need, or partnership potential. In some cases, that might mean entering via alliances with local players who offer pathways to regulatory compliance or established customer bases. In others, it may involve tailoring standalone products for specific industries or use cases, such as SME payments, cross-border remittances, unbanked or underbanked populations.
Crucially, trust matters. Consumers and businesses in LATAM are increasingly digital, but they are also discerning. Local presence, customer service, and transparent pricing are all part of what builds credibility in a fast-moving environment.
To say Latin America’s digital payments landscape is evolving is an understatement. It’s more accurate to say it is accelerating. For product, marketing, and strategy leaders, the opportunity lies in moving beyond headline trends and engaging with the specifics: who the customer really is, what the competition is doing, and how regulations are shaping the market.
Those who succeed will be those who ask the right questions early, move with intent, and build from a foundation of local understanding.