Emerging African countries are among the fastest growing regions in consumer spending, according to World Data Lab data analyzed by EBANX, a global technology company specializing in payments services for emerging markets. Giant Egypt will accelerate its growth by 167%, while smaller economies like Ethiopia will grow by a staggering 429% over the next decade. The analysis also mentions Kenya (115%), Morocco (107%), Ghana (106%) and South Africa (42%). These numbers were announced this week at the Napa Valley (USA) chapter of the EBANX Payments Summit, an annual event that brings together industry leaders to discuss trends and innovation in the digital economy and payments.
“Among the emerging markets shaping the future of consumption, Africa is often overlooked. But the numbers tell a different story. In 2024, the continent will be second only to Asia, adding 10 million new consumers. Africa will become the next frontier for digital commerce,” said Wiza Jarakasi, Director of Market Development for Africa. At Ebanks. Additionally, EBANX highlighted two other regions that stand out for their relevance and acceleration: India and Latin America. India’s consumer spending is expected to cross a staggering USD 5.4 trillion by 2034, which is a 198% growth compared to the current USD 1.8 trillion. This makes the Asian country the world’s third-largest market after the United States and China. In Latin America, Brazil (62%) and Mexico (54%) lead the way, with each expected to spend more than US$2 trillion in consumer spending over the next decade.
“This growth is directly tied to the digitization of the economy and the payment innovations these markets have experienced in recent years,” explains Rashmi Sapte, Country Director, India, EBANX. “During the Payments Summit, we heard from many global players that emerging countries are becoming increasingly important to their businesses. Digital commerce in emerging markets will grow at a rate of 20% annually between 2017 and 2027, according to data from Statista Market Insights featured in the digital payments and commerce report “Beyond Borders 2024” by EBANX. 2017, which is 7 percentage points higher than in 2017. developed country. According to Payments and Commerce Market Intelligence (PCMI), the combined digital economies of India, Latin America and Africa are expected to exceed US$1.3 trillion within three years.
CHALLENGES, INNOVATIONS AND OPPORTUNITIES
Industry leaders gathered in Napa Valley for an in-depth discussion on the state of payments in the digital economy and emerging markets. “Some are linked to others. In India and Latin America, digital commerce drives digital payments; in Africa, the opposite is true; digital payments drive digital commerce. and challenges affect the means, not the ends, because the outcomes of this digital revolution are very similar in all these regions: economic development, financial inclusion, innovation, etc.” said Juliana Echeverry, Director of Growth. At Ebanks. Due to low credit card penetration, barriers to accessing banks, and consumer behavior, fintechs and governments can simplify consumers’ lives and allow them to purchase products and services using local payment methods. I started looking for a solution to do this. As a result, there has been a shift in the way people engage with digital commerce in emerging markets.
African countries, along with other emerging economies, are examples of how emerging markets have led the way in payments innovation. It’s been 17 years since the continent embraced mobile money, a financial service that allows payments and exchange of value to be made through mobile phones without the need for an internet connection or bank account. For example, it accounts for almost half of Kenya’s total digital commerce, accounting for US$2.3 billion or 48% of the market, according to PCMI data. Including mobile money, APM will account for approximately 63% of Africa’s digital commerce by 2025. “While this situation is promising, there are still challenges to address, such as high market fragmentation and lack of interoperability.In Napa Valley, industry experts advocated for strategic partnerships linking Africa and the world. And that is exactly what EBANX is doing,” Jarakasi pointed out.
In India, home to the world’s most widely used instant payment system, UPI is the preferred method for online purchases, accounting for 55%, 30 points higher than credit cards, according to PCMI. For recurring purchases, UPI AutoPay has around 10 million recurring payments every month with an average approval rate of 92%, according to National Payments Corporation of India (NPCI) data. In Latin America, Brazil’s instant payment system Pix is following the same path and will surpass credit cards in digital commerce by 2025. At that time, the local central bank plans to launch Pix Automático (translated as Automatic Pix) for recurring payments. “Incorporating alternative payment methods (APM) is not only about providing more choice, but also about bringing people in,” Etcheverry emphasizes. “Companies that adopted Pix with EBANX for digital commerce in Brazil saw a 25% increase in customer numbers and a 16% increase in revenue.”
Future payment trends
Among the many constructive and forward-thinking discussions, one that EBANX Payments Summit participants were most excited about was the discussion on future trends in emerging markets, such as hybrid APM and card combinations. It was a discussion to work on. For example, in India, credit cards are seamlessly integrated with UPI, enabling credit card payments through instant payment apps with a familiar UX and flow. “It’s exciting to see how these countries are being creative and innovative in finding solutions that not only change but simplify consumer habits,” said Jarakasi, EBANX’s Africa Market Development Director. That’s amazing.” In Egypt, 64% of digital commerce payments are in cash, and even people without bank accounts can buy online and pay through an app or QR code. “This is financial inclusion, this is access.”
