In the global e-commerce landscape, Latin America is becoming a high-profile “new blue ocean.”
However, behind this market that seems to be full of opportunities, there are many challenges hidden, and the payment problem has become an “invisible wall” in front of China’s cross-border e-commerce.
Unlike Europe and the United States, which rely on credit cards and have relatively standardized user experiences, payment methods in Latin America are highly fragmented.
In Brazil, people will give priority to Pix instant payment led by the central bank for online shopping, which is real-time, interest-free and has almost universal coverage.
In Mexico, about 42% of the population does not yet have a bank account. When they shop online, they will take their vouchers to a local convenience store with more than 20,000 stores and pay with cash.
This diversified payment method makes Chinese cross-border e-commerce companies face huge challenges when entering the Latin American market.
Despite this, the potential of the Latin American market cannot be underestimated.
According to data from the General Administration of Customs, the trade volume between China and Latin America and the Caribbean will reach US$565.28 billion in 2025, a year-on-year increase of 6.5%.
The e-commerce market size of the two largest economies, Brazil and Mexico, will exceed US$35 billion in 2025, and they will still maintain a year-on-year growth rate of more than 14%.
This market, once ignored by many people, is now becoming the hottest battlefield for China’s cross-border e-commerce.
From e-commerce platforms such as Temu, SHEIN, and TikTok Shop to tens of thousands of cross-border e-commerce sellers, they are all actively exploring the possibilities of this market.
Tristan Chiappini, senior vice president of global commerce at PPRO, observed that as the geopolitical environment and tariff policies become more complex, Chinese merchants are beginning to expand more into markets outside the United States, such as Europe and Latin America.
In terms of industry distribution, demand comes from multiple vertical fields, including traditional e-commerce, cross-border e-commerce platforms, the gaming industry, and online travel platforms.
The trade relationship between China and Latin America is also continuing to deepen.
Currently, 24 Latin American and Caribbean countries have signed cooperation documents with China on jointly building the “Belt and Road”.
As an important trade channel, e-commerce has shown rapid growth in the Latin American market.
According to eMarketer’s data forecast, in 2025, e-commerce sales in Latin America surged 12.2% to US$191.25 billion, a growth rate that is 1.5 times the global average. Latin America has also become the fastest growing e-commerce market in the world, and this trend will continue until 2027.
However, market popularity does not mean it is easy to enter the market.
Many practitioners pointed out that Latin America is far more complex than Europe and the United States.
High fragmentation of payment methods is just one of the challenges, with tax and exchange rate issues being equally thorny.
Brazil is known as the “Country of Ten Thousand Taxes”. Its tax system is composed of dozens of taxes at the federal, state and municipal levels. Among them, interstate transfer tax has different tax rates in each state. Interstate transportation and sales require complex tax calculations and declarations, and compliance costs are extremely high.
The exchange rate issue cannot be ignored. The exchange rate difference between different countries and banks in Latin America may reach 10 percentage points or more. For merchants, this simple choice may bring huge cost differences.
For companies going overseas to Latin America, Victor Cadena, executive vice president of the China-Mexico Chamber of Commerce, gave three suggestions: abide by local regulations, seek professional legal advice, and form a local team.
He emphasized: “Having a local team that understands the local culture and market is the key to success. Most successful Chinese companies in Mexico have achieved effective integration of local teams and Chinese teams.”
Trade volume is growing and platforms are expanding, but the invisible barrier that requires money to flow safely and efficiently from the accounts of Latin American consumers into the accounts of Chinese merchants is still a reality that every overseas company must face.
Payment, tax, compliance, exchange rate, localization – every link may become a new challenge or a new competitive barrier.
