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E-commerce booming in Latin America and Caribbean - Visa
Category: E Commerce
Online retail spending by consumers in Latin America and the Caribbean soared 40% in 2007 to hit US$10.9 billion, according to a study commissioned by Visa.
The AmericaEconomia Intelligence research - which is based on qualitative and quantitative information from 17 countries - shows e-commerce has grown 121% in the region during the last two years.
Venezuela has seen the biggest surge, with e-commerce up 224% over the last two years, followed by Chile at 183%, Mexico at 143% and Brazil at 116%.
The study also found that credit cards are the most popular method for online payments and are preferred by 70% of customers.
One of the major factors behind the boom is a 48% increase in Internet penetration, as well as more than 100% growth in broadband access in the region over the last two years. Visa says this has resulted in faster connections that make online shopping easier and far more convenient.
E-commerce, combined with a period of sustained prosperity, has also provided customers in the region with the ability to buy international goods previously out of their reach.
But despite the rapid rise of e-commerce, the industry is still far from mature in Latin America and the Caribbean and represents just 0.32% of the region's GDP, compared to 0.98% in the US.
The study found that more than a third of online purchases are made by consumers outside of their country of origin. In countries where e-commerce is less developed, the percentage of international transactions could be as high as 90%.
This contrasts with a recent European Union survey that found that cross border e-commerce activity in the region has stayed flat - rising from six per cent in 2006 to seven per cent this year.