- Business Case -

Understanding Online Payments in Argentina

 Argentina’s e-Commerce is full of opportunities
With a new government in December 2015, Argentina is the third largest economy in Latin Amer-
ica, and its e-Commerce market is currently the third
Argentina is opening up to international trade and
largest. Business-to-consumer (B2C) e-Commerce
becoming more attractive to foreign investors. It sales are forecasted to reach $9 billion US in 2016
is the third largest e-Commerce market in Latin and then grow by 14% a year until 2018.
America with more than 10% of the region’s volume.
Argentina experienced a profound financial crisis be-
Moreover, Argentina is expected to experience 14%
tween 1998 to 2002, creating economic turmoil that
growth a year in e-Commerce until 2018. Online affected the country for many years. High inflation
bank transfers and cash-based methods are strong and fear of economic depression contributed to the
creation of a thriving black market for foreign curren-
in the e-Commerce sector.
cy that that the government has only recently begun
to control.
This is one of the many aspects that the new admin-
1. e-Commerce Sales in Argentina, 2016 - 2019 istration led by President Macri has changed. The
(billion USD)
economy appears to have stabilized and has opened
to global markets in the last six months. Foreign
investment is pouring in, and the whole market is
13
opening. Like in other countries in Latin America, it is
11 now possible to remit funds outside Argentina.
9
Despite its economic difficulties, Argentina has kept
7
up with technological advancements and has the sec-
5 ond mobile penetration in Latin America after Chile.
A large number of customers use their phones to
make payments, increasing the importance of being
able to charge Online. 75% of the population has ac-
2014 2015 2016 2017 2018 cess to the internet, one of the highest percentages
source: eMarketer in the region. This is reflected in the purchases that
Understanding Online Payments in Argentina: A Business Case by allpago
Argentinians are performing Online. Business Insid-
er says e-Commerce in Argentina corresponds to al-
most 12% of the market in Latin America.
According to Camara de Comercio Argentina, seven
in 10 Argentinians use a credit card to make purchas-
es Online. Amongst those that don’t, 29% say it is be-
cause of lack of trust. The distribution of products is
also something that merchants should have in mind.
There is a lot of space for improvement in this area
when average delivery times are no less than a week.
Having access to local payment methods is key for
international merchants to benefit from the opening
of this market.
RapiPago and Pago Fácil
have a strong presence in the market
RapiPago and Pago Facil are cash based Online pay-
ment methods that are fundamental for selling prod-
ucts and services Online in Argentina. To use them,
the customer prints out a receipt when transacting
Online and pays cash at any point that accepts these
payments. They work like a Boleto in Brazil, Oxxo in
Mexico and Baloto in Colombia.
Cards and Online bank transfers are also relevant
in the Online payment distribution and merchants
should consider them. Debit cards are very popular
in Argentina. Lafferty says that 85% of workers in for-
mal jobs have a payroll account with a 0% cost Debit
 card linked to the account and now the main acquir-
2. Online Payment Methods Share in Argentina, 2016 ers are beginning to accept Debit cards Online. Credit
Recommendations
cards have gained greater usage in recent years as
for operating locally in Argentina
banking and merchants have used significant rebate
Online Bank promotions to encourage the use of credit.
Transfers Merchants will face challenges when going into the
12%
The acquiring market in Argentina has been difficult Argentinian market. Offering local payment meth-
Cash Based to access. Visa (Prisma) and MasterCard (First Data), ods, tracking local regulation, knowledge of local
Methods which are owned by the top banks, dominate the ac- taxation and remitting money outside the country
44%
Cards quiring business. The situation is slowly changing as are particularly relevant.
44%
the market has opened and new players are moving
into Argentina. Besides, the government is regulating However, the country is at a turning point regard-
the market and putting caps on the prices that the ing market flexibility, and merchants should take
banks and acquirers can charge in exchange rates to advantage of this opportunity. International mer-
merchants. chants working in Argentina need a reliable partner
source: allpago Research
with local knowledge and connections to key players
The primary issuers for Visa and MasterCard in Ar-
in the market to tackle the issues and thrive here.
gentina are Banco Galicia, Santander, and BBVA, but
3. Share of Acquiring Market in Argentina, 2014 closed looped cards like Tarjeta Naranja are also
critical in the market. Due to a saturation of cards
in high-income segments, local schemes like Tarjeta
Naranja were launched successfully for low to medi-
Visa 64%
um tiers and have gained market share.

First Data 23%

Others* 13%

0% 10% 20% 30% 40% 50% 60%

*Tarjeta Naranja and Cabal source: Lafferty

Understanding Online Payments in Argentina: A Business Case by allpago

 Javier Vallaure If you want to improve your payments in LATAM
Chief Business Development Officer

Javier Vallaure is the Chief Business Development

CONTACT US
Officer of allpago, the new way of accepting
payments in Latin America. Prior to allpago, he
worked as an analyst at Morgan Stanley in London
and as a property asset manager at Grupo Lar in
Mexico.

Javier holds a Double Diploma from Universidad

Pontificia Comillas and Reims Management School
as well as an MBA from ESMT.

Javier is fluent in Spanish, English, French, German

and Italian.

Understanding Online Payments in Argentina: A Business Case by allpago

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