Glossary

E-commerce

In this study, e-commerce covers all online purchases of goods and services, regardless of the device or payment method used or vertical (including retail, travel, or digital goods and services). This includes purchases made with locally issued payment methods, cross-border purchases, B2C e-commerce, and B2B e-commerce that flows through a merchant’s online website and payment gateway.

Verticals

Online retail

Physical products bought online from a marketplace or directly from a merchant, including department stores, independent shops, online-only retailers, grocery stores, etc. Groceries and restaurant purchases made through delivery apps are categorized in another specific vertical. 

Travel

Airline tickets, car rentals, tour packages, and lodging purchased online

Mobility

On-demand transportation and delivery services apps. Excludes payments made in cash.

Gaming

Spending on online games or in-game purchases, which can be played via mobile, desktop, or console. This does not include sports betting, online gambling, or games of chance.

Streaming

Video and music streaming, typically purchased as subscriptions.

SaaS (Software as a Service)

Software services that are accessed via cloud, rather than through the installation on a computer or device. Data considers both B2B and B2C purchases made via an online website or through a checkout process, including subscription and recurring payment models. Numbers do not include purchases not made through an official online checkout, such as invoice payments via online banking or wire transfer.

Digital services

Additional and varied digital goods and services, including online education, digital downloads, mobile top-ups, sports betting, and online gambling, taxes, licenses, fees, and other payments done online over an e-commerce gateway (such as insurance, school tuition, etc.).

Payment methods

APMs (alternative payment methods)

Anything other than credit or debit cards. In this study, it includes online purchases made with cash-based vouchers and cash on delivery, but also digitized and instant payments such as digital wallets, account-based transfers, and other methods that you can find in the definition below.

Credit cards

All locally-issued credit cards.

Debit cards

All locally-issued debit cards.

A2A transfers

Transfer solutions that work through digital, fintech-offered accounts, or traditional bank accounts. This includes proprietary bank transfer solutions developed by individual banks, account-based transfers enabled by an aggregator, real-time payment systems, or transfers made on a bank consortium platform. Examples include UPI (India), Pix (Brazil), Bre-B (Colombia), Debin (Argentina), Netbanking (India), SPEI (Mexico), and Capitec Pay (South Africa).

Cash payments

Enable shoppers to pay in cash for an online order via a bar code, a unique PIN, or a QR code. Payments are usually made at an affiliated physical location or, in some cases, through internet banking, online bank transfer, or digital wallets. Examples include OXXO in Mexico, Boleto Bancário in Brazil, and most of the volume from Fawry in Egypt and PagoEfectivo in Peru (note: Fawry and PagoEfectivo are considered hybrid payment methods since they enable digital payments as well).

Cash on delivery

When customers pay for one online purchase at the time of delivery rather than in advance. This payment is typically made in cash, but in some markets, companies also accept card or digital payments at delivery.

PagoEfectivo

The most critical offline payment method in Peru, PagoEfectivo is currently a hybrid payment method that allows both cash payments and account-based transfers. It generates a voucher or a QR Code that can be paid for offline in cash, via online banking, or with their digital wallet.

Fawry

Fawry is the most important offline payment method in Egypt. Initially created for cash payments, it has now evolved into a hybrid payment solution. When Fawry is integrated at a merchant's checkout, consumers can make payments using various methods, including cash vouchers (reference code) and cards through the Fawry app (either credit, debit, or prepaid).

Digital wallets

A payment method that stores any funding source on file, including a credit card, debit card, account, or stored balance. Wallets use that funding source to remit payments. In this study, volumes in the "digital wallets" category are considered when a single wallet brand is selected at checkout, even if a different funding source (such as a credit card) is ultimately chosen as the payment method. Examples include Mercado Pago, Nequi, TigoMoney, and PayPhone. Tokenized card wallets, or passthrough wallets, such as Apple Pay, are included under credit and debit card volume.

Mobile money

A mobile payment method based on active mobile lines (built into a SIM card) from telcos. Users can store and exchange funds using GSM network signals and USSD technology, eliminating the need for an internet connection. The funds on mobile money accounts can be traded digitally and are withdrawable as (or depositable into) cash at authorized agent locations. Examples include M-PESA and Airtel Money.

Buy Now Pay Later (BNPL)

A payment button offered by a BNPL fintech that enables the shopper to finance the purchase at checkout, with multiple payment methods, including credit cards, debit cards, account-based transfers, or cash. It is offered worldwide, but may have less traction in regions and countries where installment plans are predominant.

Other

This category comprises other payment methods not explicitly listed, including direct carrier billing, cash on delivery, and ATM payments. 

Another important definition

Account ownership in emerging markets is not synonymous with having a traditional bank account. It considers any account at a regulated institution, which includes banks but also fintech companies, mobile money providers, credit unions, microfinance institutions, or post offices.

Over the last couple of years, financial inclusion in emerging economies has been increasingly driven on the side of banks, but through fintech companies and other innovative solutions for payments and financial products and services.

This is why this study adopts the definition of "A2A transfers", and not necessarily "bank transfers" (as seen in this glossary), and why we consider that financial inclusion goes far beyond bancarization itself.

Methodology notes

To develop the market data and forecasts for this study, PCMI (Payments and Commerce Market Intelligence) used two methodologies: 1) desk research, accessing both local and international public sources; and 2) interviews with key players in the industry. Public sources include reports conducted by local industry chambers, e-commerce associations, and research firms, as well as government and central bank statistics and reports made public by local press and organizations such as the World Bank and affiliated international organizations. The authors adopted a critical approach, identifying the holes, errors, and inconsistencies in this data to prepare it for primary research.

Then, PCMI conducted interviews with local digital commerce industry stakeholders to clarify, deepen, and streamline data collected via secondary research. Over 80 e-commerce and payments executives were interviewed – including payment processors and acquirers, card issuers, online payment gateways, and payment service providers, as well as consultants and top merchants in all product verticals.

Once data was collected from primary and secondary sources, PCMI compared, cross-referenced, and triangulated all collected data points through rigorous analysis, leveraging the perspective of their historical data collected since 2015 to arrive at the final results. In some charts, numbers might be rounded up, adding up to slightly more than 100%.

Projections are calculated based on the opinion of industry stakeholders and account for factors such as inflation, GDP growth, and regulation.