Em Conversa Paytech South America

Em Conversa: Mexican Payment Trends With Unlimint Mexico

Em Conversa looks to uncover the secrets in Latin America (LatAm) that have caused the fintech market to boom, from being worth less than $50million in 2016, to $2.1billion in 2022. Ignacio J. Morales, the country manager of Unlimint Mexico, discusses payment trends within Mexico and how they compare to the rest of the region.

Ignacio J. Morales, the country manager of Unlimint Mexico
Ignacio J. Morales, the country manager of Unlimint Mexico

Previously, Morales held different positions in the financial and payment methods industry in companies such as Citibanamex, WesternUnion and MasterCard, among others. Morales holds an MBA from IPADE and has studied at Unviersidad Iberoamericana, Oklahoma University and MIT.

Morales looks at popular payment methods in Mexico, and how they are evolving in comparison to other countries in the region. Furthermore, he looks at the impact Unlimint can have on the Mexican financial ecosystem:

Can you tell me more about the company and your role within it?

Unlimint is a global fintech company that offers a large portfolio of financial services. From acquiring (payment processing) and banking as a service to a web3 onboarding tool that helps users move value seamlessly between their bank accounts and their self-custody wallets, to access DeFi, GameFi, and NFTs.

Our solutions are purpose-built and answer the needs of retailers and merchants worldwide, who are looking for a secure, scalable, efficient, and cost-effective solution that can be seamlessly integrated into their business.

As head of Unlimint Mexico, I am responsible for managing the company’s activities in the region and assisting Mexican innovators and international companies that want to disrupt the Mexican market. We want to help them achieve their goals by leveraging our solutions and payments portfolio.

How do payment trends compare to the rest of the region/world?

For the past few years, Mexicans have been buying more online. Therefore, the way consumers make payments is changing. Debit card payments continue to be the most popular payment method for online purchases for 58 per cent of Mexicans. It is also the most used and preferred method for 27 per cent of people according to Instituto Nacional de EstadĂ­stica y GeografĂ­a (INEGI).

But this scenario is changing. Mexicans are also adopting other digital payment methods such as digital wallets and mobile electronic transfers. One popular example of such new methods is CoDi, a 24-hour instant funds transfer platform created by Banco de MĂ©xico, which works through QR Code scanning.

CoDi and beyond

CoDi stands out among other methods due to not having cost per se for the merchant. This is in addition to a high level of security, as it does not allow chargebacks. Despite this, for now, CoDi adoption is still very low. 12.6 million people are using CoDi from their cell phones, only 10 per cent of the Mexican population according to Banco de MĂ©xico.

Another payment method that is getting traction is SPEI, a 24/7 solution to make transactions with a real-time payment confirmation. This year, SPEI usage has increased by 56 per cent in August in comparison with last year and by 200 per cent compared to the previous year, reaching more than 240 million transfers in one month. I believe that SPEI has the opportunity to get more market share considering its potential and convenience.

CoDi and SPEI have not yet gotten the preference of all Mexicans. However, there is great potential for them to become increasingly popular payment methods. Especially considering the country has between 77 and 88 million active smartphones in 2021 as reported by to Hootsuit, but still less than 40 million Mexicans with a bank account according to Digital 2021 Global Overview Report. In other words, there is a market to be conquered.

On the other hand, 27 per cent of Mexicans still use cash-based payment methods in e-commerce, according to data from INEGI. Among cash payments via voucher, Oxxo Pay and 7 Eleven are the ones that merchants need to include in their portfolio if they want to attend to different needs, avoid cart abandonment and ensure sales conversion rates.

What is Unliminit Mexico doing to help improve the payment sector in the country and region?

Unlimint’s essential goal is to remove existing borders and limitations and deliver a seamless payments experience. We help local businesses thrive both locally and internationally. We are able to provide merchants with strong, efficient payment rails. This is thanks to the fact that after more than 13 years on the market, our team has managed to build the largest in-house developed payment infrastructure in the world.

We are directly integrated with more than 1000 payment methods worldwide. We hold local acquiring licenses in regions of presence. Additionally, we have fantastic teams consisting of local industry experts from all over the world.

On top of that, we are also constantly evolving with the industry and are aware of global payment trends. We offer payment solutions that permeate the entire financial universe. For example, the recently launched GateFi, an on-ramp solution for dApp developers, that acts as a bridge between Web 2 and Web 3. Another example would be Unlimint BaaS, a configurable API platform that helps customers launch their own financial solutions with ease.

We are directly integrated with more than 1000 payment methods worldwide.

How does the Mexican payments market compare to the rest of LatAm?

Latin American countries have similarities in the adoption of different payment methods. They have similar ratios of unbanked population, access to internet connection and informal economy for example.

This scenario, however, has changed and one of the main incentives for this is the increase of mobile internet connection. A World Bank study states that 57 per cent of Mexicans had access to mobile Internet in 2020. This rate is expected to increase to 65.3 per cent by 2025 with 11 million new users.

More and more people are using digital payment methods in Mexico like digital wallets and CoDi. During 2021, 2.4 million CoDi transactions were settled, equivalent to an increase of 142 per cent compared to 2020 according to Banco de Mexico. Since June of that year, the growth in the use of CoDi has been gradual. It reached the maximum number of average daily transactions in December, with 7,100 transactions. The average spend was approximately 900 Mexican pesos.

Compared to Brazil’s PIX

Digital payments like CoDi in Mexico still have a path to thrive and they are far behind countries like Brazil with PIX. PIX is another instant digital payment method, used by 130 million people and 11.4 million businesses at least once in October 2022, according to data from the Brazilian Central Bank. But since there are still a great number of people and businesses that need to start the digital payment experience, this means that there is a relevant market to explore.

In summary, consumers in Latin America have similar expectations and needs when adopting new payment methods. They need them to be fast, reliable, accessible and cost-effective. But at the same time, there are some differences in some markets that are frontrunners like Brazil with PIX. However, more and more SPEI in Mexico and PSE, the equivalent of instant payment method in Colombia, are conquering consumer preference.

What are some unique challenges associated with the Mexican payments market?

Although Mexican e-commerce is growing significantly every year, it represents only nine per cent of the total retail sales value according to AMVO (Mexican Online Sales Association). One of the main challenges for online sales to continue growing in the country is the recurrent complaint from online consumers regarding delivery delay (31 per cent of buyers surveyed by AMVO).

It is important to remember that last-mile shipping is no longer a premium service. Rather, it is basic consumer demand, especially for services such as supermarkets and drugstores.

Another challenge is the high rate of transaction rejection, which is currently one of the highest in the world. During the first quarter of 2022, 217 million online purchase transactions by credit or debit card were reached. It totalled more than 142 billion Mexican pesos according to data from the National Commission for the Protection and Defense of Financial Services Users (Condusef).

However, only 62 per cent of online card transactions were approved, according to Condusef. In order to improve this rate, it is important that online stores have a payment partner that offers an efficient anti-fraud system. It must rely on more advanced machine learning and artificial intelligence technologies that are able to halt really insecure transactions. But simultaneously approve purchases that do not offer any risk, improving the rate of purchase approval.

Dominating trends

Finally, as we know, omnichannel is the trend of the moment, since consumers want the opportunity to discover, try, buy and receive products in the way they prefer.

When it comes to omnichannel, Mexican brands are still incipient. Omnichanel is more than having physical and online stores. It’s more than offering the option of product delivery where it is most convenient for the client. It is also offering an infrastructure that is capable of meeting this concept. For example, a stock adaptable to different points of sale and versatility of sales channels and points of experimentation and product testing.

What are the plans for the future?

The Mexican e-commerce market is very promising. According to AMVO’s Hot Sale 2022 results report, during the nine-day event, between May 23rd and 31st, 23.4 billion Mexican pesos ($1.16billion) were generated, 25 per cent more than in 2021.

The retail sector was the most benefited, with 64 per cent of total sales. This is proof that there are still plenty of opportunities for companies that want to digitise and boost their business. This is why we will continue expanding our portfolio of payment methods for the region. We want to strengthen our offering for merchants by implementing new and innovative technologies.

In addition, we will also continue to explore our cross-border operation in the region. This is distinguished by the fact that we offer more than one thousand alternative payment methods worldwide. We have the opportunity to connect Mexican merchants with customers all over the world. We allow them to offer their customers’ payment methods of choice. This essentially helps them move closer to the omnichannel experience goal.

Final thoughts

We are experiencing a fantastic transformation in the payment ecosystem, not only in Latin America which holds one-quarter of the global fintech platform, but specifically in Mexico that gathers 22 per cent of the fintechs in Latin America according to IDB Invest and Finnovista study.

Unlimint is ready to provide these innovators with the ideal tools to connect every financial method. We want to do this in an easy and cost-effective way. We understand that customers want to have the right to decide what is the best way for them to make their payments.


  • Francis is a journalist and our lead LatAm correspondent, with a BA in Classical Civilization, he has a specialist interest in North and South America.

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