Consumers worldwide are reconsidering the way they do everything from pay bills to meet their job responsibilities in the aftermath of the global health crisis, as remote, virtual-first interactions have become the norm for many workers.
Many individuals are also considering participating in the gig and sharing economies as they search for more flexible forms of income, a trend that is especially growing within regions such as Latin America, where much of the population is also gaining access to digital and mobile payment tools. For example, one report found that 83% of consumers within Latin America would be open to using contactless payments to make purchases. The growing popularity of such payment methods could also filter into how many consumers want to receive their wages or other payments.
In the latest Digitizing Payments In Latin America Playbook, PYMNTS examines how the gig and sharing economies are taking shape across Latin America. It also takes a closer look at how participation on such platforms could be influencing the payment preferences and needs of consumers in the region.
Around the Latin American Payments Ecosystem
The rising interest in the gig economy and other forms of flexible, remote work is also leading lawmakers within Latin America to take a closer look at these workers and the protections they have. Mexican lawmakers are considering granting new protections for digital platform workers under its Federal Labor Law, for example, which would include drivers, delivery service workers, couriers and other freelancers. Such a shift would mean these workers would enjoy the same labor protections as the country’s full-time employees, indicating lawmakers are anticipating that both freelancers and full-time employees will increase their use of digital platforms to conduct their job responsibilities in the future.
Sharing economy platforms are also moving to add new features to keep their customers engaged as more consumers worldwide grow familiar with gig work opportunities. Ride-sharing company Uber recently announced the implementation of an Explore tab that will allow its users to book restaurant reservations or reserve tickets for live events, for example — a new feature aimed at boosting customer engagement. The tab will also offer consumers the option to book rides to these reservations, keeping the experience within the app. Uber is gearing this toward improving engagement and loyalty, and the feature is currently available for consumers in both Mexico and the United States.
For more on these and other stories, visit the Playbook’s News and Trends.
Cabify: Why Latin American Gig Platforms Must Make Space for Digital Payments
The gig and sharing economies have continued to see massive growth during the past several years, especially in regions like Latin America, where many consumers are also swiftly gaining access to online banking and payment tools. The expansion of the gig economy throughout this region also means gig platforms must take steps to keep the attention and loyalty of potential participants, explained Ruth Sosa, head of product, finance for Latin American rideshare Cabify. This includes providing a swift, convenient payment experience both for participants and customers.
To learn more about why Latin American gig and sharing platforms must take steps to support more flexible digital payments, visit the Playbook’s Feature Story.
Consumers have changed how they shop, pay and even work since the global health crisis began. Workers worldwide seek more flexible career opportunities, driving up participation in the gig or sharing economies as freelance positions become more attractive to such individuals. Such jobs can prove particularly interesting to consumers who remain underbanked or unbanked and are therefore reliant on cash to pay their bills or make other payments. One recent study found that 140 million Latin Americans, or approximately 59% of the region’s population, work informally, relying on cash income. Working within the gig economy can allow such workers to receive funds via sharing entities’ mobile platforms without requiring bank accounts, bringing them further into the region’s developing digital payment ecosystem.
To learn more about how the rise of the gig economy may be influencing Latin American consumers’ payment preferences, visit the Playbook’s Deep Dive.
About the Playbook
The Digitizing Payments In Latin America Playbook, done in collaboration with Kushki, examines the latest digital payments developments in Latin America, including how payment service providers can support consumer demands and gain a foothold within the region.