For years, the subscription economy in emerging markets felt like an exclusive club. To join, a consumer typically needed a credit card —sometimes, an international one—, a luxury held by only a fraction of the population. Global giants like Netflix, Spotify, and various SaaS providers faced a recurring dilemma: how to build long-term loyalty in regions where cash, vouchers, and one-off transfers dominated the payment landscape.

The early solution was a "digital patchwork." Consumers would manually pay a monthly Boleto in Brazil, buy physical gift cards in supermarkets, or use prepaid vouchers in Peru. But manual renewals can be a silent killer of retention. "Every time you add friction to the journey of an already onboarded customer, you are throwing your acquisition cost away," notes Arthur Queiroz, Merchant Operations Senior Manager at EBANX.

While one-off payment strategies remain highly useful for acquiring underbanked customers, an alternative has been emerging in the market. Now, APMs are evolving into sophisticated infrastructures that work both on-file and with recurring capabilities. They are transforming transactions into seamless, automated flows and becoming complete players in the payments ecosystem.

The move to recurring APMs is, first and foremost, an access play. In many emerging markets, the population with an active bank account or digital wallet is significantly larger than the one with a credit card. In Brazil, roughly 60 million people —or 35% of adults— do not have access to credit cards, yet 95% of the population uses Pix, according to the Central Bank.

When taking a global look, the sheer scale of these platforms is staggering. GCash in the Philippines boasts 95 million users, Mercado Pago has a base exceeding 60 million across Latin America, Nequi in Colombia serves 25 million people, and Yape in Peru has 18 million “Yaperos”. In Nigeria, the Direct Debit system is enabling bank transfers for recurring transactions at scale, while OPay is rapidly building its own subscription infrastructure for its 50 million users.

For these users, the APM isn't a "backup", but their financial home. They use it to pay for groceries, send money to family, and manage their daily lives. Even cardholders often choose them because they offer a familiar, secure, and instant experience. Unlike cards, which in many emerging markets are plagued by sophisticated phishing and fraud risks, APMs like Pix, Mercado Pago, Yape and Nequi rely on native, biometric, and app-based authentication.

In Peru, this central role is visible even in language. Yape, the country’s leading wallet, has become a verb. “People don’t say ‘send me money’. They say yapéame,” explains Alvaro De La Torre, Country Growth Manager for the Andean Region at EBANX. “Everyone uses Yape. It’s already recognized as a word, and ‘yapear’ is a synonym to make a transfer.” According to De La Torre, the app reflects a broader cultural shift. “It represents a clear before and after in Peruvian daily life.”

Much like Brazilians say “make me a Pix,” this linguistic shift shows how deeply APMs have moved from being solely payment tools to being foundational to everyday infrastructure. This cultural adoption has translated into market dominance: Pix surpassed credit cards to become Brazil’s leading e-commerce payment method for the first time in 2025, capturing 42% of online purchases last year, compared with 41% for cards. With an estimated CAGR of 18% through 2028, the instant payment system is projected to account for 45% of online purchases by year-end and reach an impressive 50% by 2028.

The contrast between APM popularity and card ownership is particularly clear in South Africa. Capitec Bank, the country’s leading retail bank, serves 24 million clients — half of the adult population — yet only 3% of them own a credit card. A credit-card-only strategy in this market effectively ignores 97% of a highly digital, banked audience.

Capitec Pay, Capitec's digital account-to-account payment method, already addresses the gap in recurring transactions in the domestic market, enabling subscriptions directly from bank accounts without relying on card credentials. The upcoming cross-border version, expected in 2026, will extend this model beyond national boundaries, allowing international merchants to reach a consumer base that remains largely inaccessible through traditional card rails.

Another piece of the puzzle is M-PESA, Kenya's leading mobile money provider. While it transformed P2P and bill payments in Kenya, its expansion into recurring e-commerce is highly anticipated by the subscription ecosystem.

As APMs mature, two distinct technical models for recurring payments have emerged, creating a learning curve for global companies: one that emulates the experience merchants have with credit cards and another more focused on user defense.

In the first model, control over the billing cycle and retry attempts remains with the merchant, who decides the ideal moment to initiate each transaction —much like what happens with cards. For companies, it offers greater flexibility and autonomy.

Wallets like Mercado Pago, NuPay, Nequi, and Yape have opted for this "card-like" experience. Once a user authorizes an enrollment, the merchant gains the power to initiate charges (merchant-initiated transactions or MIT) without further user interaction.

Certain APMs also offer a unique advantage: redundancy. "Mercado Pago has a backup payment method that cards simply don't have," says Javier Kaniewicz, Country Growth Senior Manager for South LatAm at EBANX. If a user’s balance is low, the system can automatically pull funds from a registered card or offer a micro-credit line. This safety net helps to keep the subscription active when a card would otherwise be declined.

The results follow. A global SaaS provider that adopted the wallet saw an 11% increase in paid subscriptions and a 13% boost in free trial sign-ups in Argentina. On average, approval rates for Mercado Pago Recurring in the country are 7.4pp higher than for credit cards.

In Peru, Yape has already demonstrated its power, reporting a +90% approval rate for recurring transactions and outperforming traditional cards by up to 38 percentual points.

NuPay, which leverages Nubank's massive base of 100 million users in Brazil, has also seen conversion rates above 90%. Its primary appeal is "extra credit", allowing users to subscribe even when their main credit limit is exhausted.

In contrast, India’s UPI AutoPay and Brazil’s Pix Automático are built on a philosophy of consumer defense. These systems were designed by regulators (National Payments Corporation of India, or NPCI, and the Central Bank of Brazil), who prioritize user transparency over merchant "omnipotence".

UPI AutoPay is the pioneer of recurring alternative payments. Launched in 2020, it has achieved a level of product maturity that enables it to serve as a blueprint for recurring success. Its core strength lies in its balance of security and predictability. "UPI is the poster boy of instant payments for the ecosystem it created around itself," says Rashmi Satpute, Country Director for India at EBANX.

A standout customer-centric feature of the Indian system is the pre-debit notification, in which users receive an alert 24 hours before the actual charge. "This creates a top-of-mind recall," Satpute notes. "It reminds the customer to ensure there are funds and gives them the option to cancel the mandate if they wish, which builds immense trust."

UPI AutoPay maintains conversion rates around 80%, thanks to merchants adapting to this logic and the meticulous building process undertaken by NPCI in close collaboration with the market. As Eduardo de Abreu, Chief Product Officer at EBANX, points out: "Maturity matters a lot when you talk about recurring payments, and UPI is infinitely more mature than its peers."

Brazil’s Pix Automático, launched in July 2025, is now navigating its own learning curve. For merchants, it requires a significant shift in billing logic. Payments must be scheduled between 2 and 10 days before the due date, and the system limits retries to a maximum of three attempts within seven days.

"Pix Automático stands out in consumer defense. It includes scheduling policies so the user knows they will be debited and has the power to manage authorizations within their own bank," explains Fernando Pankiewicz Gomes, Product Senior Specialist at EBANX. "For the merchant, this is a challenge because a user can cancel a subscription directly through the bank, leaving the merchant with no room for user recovery."

While adapting to this consumer-first logic requires a significant engineering and operational lift from merchants, those willing to pivot are unlocking a substantial competitive edge in terms of new customers and retention.

In India, UPI Autopay has proven to be a highly effective channel for acquiring new users. A major global SaaS company that previously only accepted card payments saw an explosive increase in subscriptions upon implementing this feature. In the first 90 days, the company gained an average of over 4,000 new users daily, sustaining a conversion rate exceeding 85%.

In Brazil, Hotmart, a global powerhouse for the creator economy, recently integrated Pix Automático via EBANX and saw a 32 percentage point uplift in customer retention when compared to traditional one-time Pix payments. By removing the friction of monthly QR codes, Hotmart is now converting four times more "failed" manual payments into continued subscriptions. Besides that, 1 in 4 new subscription buyers chose to pay via Pix Automático.

“It removes the friction of manual monthly payments, providing a seamless experience for users and improving retention, cash flow predictability, and overall growth for creators,” said Allana Braga, Head of Payments at Hotmart, during the 2025 EBANX Payments Summit.

A similar success story is seen in the streaming vertical. A subscription-based company that integrated Pix Automático in August reported that the proportion of new users subscribing to the platform via Pix Automático was three times higher than that of those using credit cards. This demonstrates that, rather than cannibalizing cards, recurring APMs are bringing an entirely new consumer segment to the table.

Pix Automático’s trajectory also reinforces a broader lesson about recurring APMs: adoption is not linear. The first months were marked by cautious experimentation, merchant adjustments, and user education. But once billing flows, mandate communication, and recovery strategies began to stabilize across the ecosystem, enrollments accelerated rapidly. This inflection was driven by coordinated efforts from the regulator, banks, PSPs, and merchants to make the experience viable at scale.

What this curve reveals is that recurring features for APMs require maturing. Each regulatory safeguard, each retry limitation, and each scheduling rule forces the ecosystem to evolve operationally. In return, trust compounds, user confidence increases, and adoption follows. Pix Automático is now entering the same virtuous cycle lived by UPI AutoPay, a phase where learning begins to translate into measurable impact.

In this sense, recurring APMs are a living infrastructure. Their performance improves as the ecosystem adapts and players learn to navigate.

As it happens to cards, for mastering APMs recurring conversion rates merchants must move beyond "discharging and hoping." Arthur Queiroz suggests that the key is understanding local liquidity cycles. "You need to know the best time to bill. In Mexico, people receive salaries bi-weekly; in Brazil, at the beginning of the month. Aligning your billing logic with these days is the difference between a successful charge and an 'insufficient funds' decline", he says.

Juliana Etcheverry, Country Growth Director for South LatAm at EBANX, also points out that maintaining clarity with customers is crucial. She emphasizes the need for customer education and transparent opt-in processes to build confidence. "Since it is something very new in many markets, some consumers are unfamiliar with the recurring features of the APMs and might fear unauthorized charges."

As we move through 2026, innovation and maturity in this space is imminent. The arrival of Bre-B in Colombia — which is expected to accept recurring payments soon— and the full maturity of Pix Automático will cement a new reality: alternative payment methods have evolved from single-transaction tools into the primary infrastructure of global commerce in emerging markets. Pretty soon, the "alternative" might become the standard.