Emerging markets are not necessarily unsophisticated about technology, and insurers and other merchants might want to take note. A new analysis looked at 16 growth markets and found that commerce technology is growing twice as fast in emerging markets versus developed parts of the world.
The data comes from PayU, a payment service provider, and its look at the transaction trends and potential of 16 growth markets in which it physically operates.
They found that ecommerce growth is soaring in places like Latin America (19.8 percent), Middle and East Africa (25 percent), Asia Pacific (36.8 percent), and Central/Eastern Europe (17.2 percent). Ecommerce technology is catching on in developed markets, too, but at nearly half the rate. Growth rates in North America, for example, are at 12 percent, and Western Europe they’ve reached 10.7 percent.
One of the reasons that ecommerce is growing so quickly in emerging markets is because of their lack of more formal banking products. PayU said that 63 percent of the population of these regions don’t use credit cards, bank transfers, cash, or other typical banking tools. That means there is an enormous opportunity in the developing world for ecommerce products and services, said Laurent Le Moal, PayU’s CEO.
“These evolving markets make way for many business opportunities, provided that merchants adapt their offering to local habits and requirements,” Le Moal said in prepared remarks.
Some examples of what PayU found: