The Latin American fintech market has boomed in the last few years. One of the key sectors that has benefitted from this boom is gametech. However, one of the most important features that needs to be prioritised is payments.
Mikael Lijtenstein is the CEO of AstroPay, a pioneer in payment solutions for consumers who want to make online purchases on international sites. Leveraging his background in engineering and experience in providing cross-border payments as well as connecting global merchants to emerging markets, Lijtenstein combines a unique blend of technical expertise and practical experience to drive innovation and solutions in payments.
Before being named CEO in November 2019, Lijtenstein was AstroPay’s Chief Operating Officer, and was responsible for all of the company’s sales and operations, including management of AstroPay’s product development, innovation, sales activities, and service in multiple markets including Latin America, Asia, Africa, and Europe.
Prior to his return to AstroPay, Lijtenstein worked at dLocal, a Uruguayan financial technology company, where he held several roles including Head of Operations and Software Developer.
Speaking to The Fintech Times, Lijtenstein explains how the development of payments will further help merchants tap into the new booming LatAm market:
The gaming industry in Latin America has grown exponentially over the past few years, and it will only continue to rise across the continent. According to Newzoo, the Latin American region represents a market of more than 270 million game players – that’s 58 per cent of Latin America’s population and mobile gaming accounts for 48 per cent of 2021’s gaming market revenues in the region. Mexico and Brazil are leading the revenue gain with $1.9billion and $1.75billion each in 2020, more than three times generated by Argentina, the third-largest market.
There are a few factors behind why Latin America is building a prominent role in the global market for gaming. Companies see the region as a key market given its fast internet connections and a massive fanbase of gaming users. The pandemic also played a significant part in accelerating online gaming in the region. People turned their time to the screens in an attempt to entertain themselves and engage socially with their peers.
With this new reality imposed by the pandemic and driven by demand and technological advances, gaming is becoming more customer-centric and consumers are more aware of the type of experience they want to have. With this in mind, developing an easy, frictionless and straightforward payment process is extremely important when doing business in Latin America.
The rise of mobile gaming and in-game wallets
Gaming is global, but payment preferences are local. This is why companies providing gaming payment services and solutions need to understand the unique behaviours and preferences of consumers in each different market and construct a tailored offering that will have the most impact with their target audience.
Latin America is home to one of the world’s most racially diverse populations and group of countries that share many things in common including language and historical experience. Both the size as well as the myriad of cultures, people and customs make this region an attractive market to be explored thoroughly. However, each country in the region is unique and deserves to be defined on its own, based on its characteristics, people and economic landscape that are influencing their growth trajectories.
In most countries in Latin America, prices of console and gaming-PC are among the highest in the world, making mobile the most viable option for many gamers in the region. Moreover, internet access across the continent is currently on the rise in Brazil, Mexico, Argentina, Colombia, Chile and Uruguay, connecting and empowering residents as well as making online gaming viable.
This growth does not come by any surprises. Users’ expectations change very quickly in the gaming industry, and it is very important to stay agile to provide the best user experience through payments. One of the latest trends emerging in gaming is the use of in-game wallets, which allows users to add funds to their accounts or purchase games and other digital items without leaving the game.
This trend is growing rapidly amongst millennial and Gen Z game players who engage with gaming in many different ways, and they are currently the biggest consumers in this market, who demand solutions that are super easy and fast. Moving towards payment processes with minimal user interaction gives better chances at increasing conversion rate when catering to this consumer group.
Crypto payments in gaming
It is clear that a new era of payments has emerged in gaming with most recent technological revolution being led by blockchain technologies. According to Wax report, 55 per cent of online gamers own crypto, and millennials are the largest demographic segment in this gamer population.
The question is why. Crypto technology empowers gamers to collect and trade using virtual assets. Crypto assets are exchangeable and tradeable anywhere in the world, offering a safe and easy way to make money. Gaming platforms often use cryptocurrencies as rewards, which offers a new revenue stream for the gaming industry from in-app advertising and marketing. Many companies, including AstroPay, have emerged to introduce a solution allowing players to earn and collect money by leveraging virtual assets to accomplish in-game objectives.
One-click payments and local payment methods
Some gamers prefer to watch their favourite players on livestream platforms like Twitch, and consoles and physical games are no longer a requirement in the segment. The key driver for this target audience is instantaneity as they do not engage with a game for a very long time. To comply with these types of demands, payment solutions need to develop a seamless and almost invisible user experience with minimal interaction.
One-click checkouts is a very important payment solution for the online gaming industry. It allows the player to quickly pay for more options or assets without having to exit the game and lose their score. It also allows users to make online transactions with a single click, without disrupting their gaming experience.
Convenience, trust and robust security are digital payments’ biggest selling points. While there is a wide range of online payment methods out there, it is crucial to understand the local payment preferences of your target customers. Offering local payment options will not only reach more people and improve the payment experience but also build positive relationships with users. There is a strong demand for trust and need for security implicit in every payment transaction a consumer does. Users make a vote of confidence every time they choose a payment option and in most cases the choice is due to familiarity – it gives customers the impression that they are buying from a local merchant. The same rule applies to the currency they prefer to pay with.
In Brazil, for example, Boleto (a ticket-based payment method) and PIX (mobile wallet) are widely popular, especially with consumers who don’t have access to traditional financial services. Pix has been adopted by over 62 per cent of the country’s adult population so it’s very important to enable this in a gaming platform to reach users in Brazilian market.
Latin America represents an attractive market for all businesses, but there is no one-size-fits-all approach to the region. In order to successfully tap into this diverse market, every gaming merchant need to understand their consumers’ needs, how they want to pay and where they want to pay.
AstroPay is the global payment solution of choice for millions of consumers in Asia, Africa, Latin America and Europe who want to purchase online on international sites. By deeply understanding the complexity that the payments ecosystem presents nowadays, the company developed One Touch, a digital wallet based on two pillars: immediacy and security.
Mikael Lijtenstein, CEO: https://www.linkedin.com/in/mikael-lijtenstein-a43507b2/?originalSubdomain=uy