Seventy-three percent of Argentina’s population uses a smartphone today, and it is being used for a variety of different things, the most popular being that of mobile messengers (92%). A whopping 91% of Argentinians watch videos on their mobile phones, 61% are playing games; and 43% are using banking services on their smartphones. In a country where less than 50% of the population has access to a bank account, thanks to widespread mobile internet access, the mobile phone is being used increasingly to make mobile payments, online purchases and to pay bills. Forty percent of adults in the country also made or received digital payments.

Given the deepening mobile penetration and the development of the mobile payment ecosystem, it is no surprise that the e-commerce market in Argentina is on track to witness strong growth in the coming years. Between 2018 and 2022, Argentina’s e-commerce market will grow by 83% to be worth US$19.2 bn. Within this, the mobile commerce segment will grow at an annual rate of 26%.

As of 2018, credit cards were the most common mode of online payments in Argentina, accounting for almost 27% of the market, followed closely by e-wallets (22%), bank transfers (14%), debit cards (10%) and cash on delivery (8%). However, by the end of 2019, it is expected that e-wallets will become the most widely used mode of online payments.

The impact of digital is playing out through other media as well. For example, in 2018, the total consumer spending on mobile apps in Argentina, stood at US$148.1m, and this number is set to grow. An increase in incomes and deepening mobile internet penetration means that digital spending through various media will increase, as people download more apps and are willing to spend more on them. The total number of apps downloaded on mobile in 2018 stood at 1.5bn, and the apps that made most revenue on mobile in 2018 included Netflix, Tinder, Happn, Google Drive, Spotify and HBO Go.

This varied mix illustrates that there are opportunities for all kinds of players in the digital ecosystem to benefit from the macro trends that are being seen in Argentina. In February 2019, the Inter-American Development Bank sanctioned a US$300m loan to the Argentinian government to improve productivity through digitalization. The government’s fintech division has been working as bridge for regulators, banks and fintech start-ups, creating an ecosystem conducive for the growth of digital payments as a way to drive adoption especially among the unbanked in Argentina.

This perspective on Argentina is part of our recently released whitepaper available here