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An Overview of Chile—Realizing the Potential South American Market

2022-08-24 06:06:34

Chile is known as The Land at the End of the World. It is the fifth largest e-commerce market in Latin America and the 31st largest e-commerce market in the world. In 2020, due to the impact of COVID-19, the demand for online shopping in Latin America has increased significantly, and a large number of entity enterprises have turned to the field of e-commerce. Despite having a population of only about 19 million, Chile is one of the largest e-commerce markets in Latin America and has the highest per capita online sales in the region, with e-commerce revenue reaching $7 billion in 2021.

Chile's consumption level is relatively high in the South American market, close to the European consumption level, with prices 30% to 70% higher than China's, and about 40% of the population prefers online shopping. The share of consumption in Chile has grown at a rate of 35% since 2017, and the online shopping population is expected to rise to 70% by 2025. The Latin American market has unlimited potential and is becoming a new blue ocean for e-commerce, and Chile just happens to be a good choice. Heading into the e-commerce market in Chile, you need to know in advance the two major challenges you will face: payments and logistics.

First, logistics has always been one of the top hurdles that Chilean e-commerce needs to address. With the rapid development of the e-commerce industry, Chilean consumers have higher and higher requirements for logistics, and they want to enjoy convenient and fast logistics services. The high traffic complexity in South America leads to inaccurate positioning, or due to the work mobility of recipients, the delivery efficiency is very low. But Chile's logistics network is among the highest in South America, and both customs clearance and distribution face fewer challenges than other South American countries.

In addition, the Covid-19 pandemic has also negatively impacted e-commerce, with numerous orders being canceled due to delays in delivery, insufficient supply, logistics constraints, and other factors. But compared to other Latin American countries, Chile's situation is good. In the field of e-commerce logistics, Chile ranks first among Latin American countries. 

Payment methods are another challenge. Consumers in Chile are very privacy-conscious. they may abandon their purchases if they cannot find a trusted payment method. Also, online payments in Chile are made in Chilean pesos via local banks and credit cards. In Chile, consumers also rely on cash payments. 

At present, many e-commerce platforms have learned that just having a credit card and Paypal payment cannot meet the payment needs of buyers, and they are well aware of the importance of having a flexible payment method. 

Epay remittance provides bank transfer, cash payment, and electronic wallet payment methods, including the popular Chilean Servipag payment and Mercado Pago wallet payment. Servipag payment covers 40% of online shoppers and is the largest online payment provider in Chile, with more than 4,000 offline payment spots in Chile, providing consumers with bank transfer and cash collection services. The Mercado Pago wallet is similar to Alipay and is an important part of Mercador (the largest e-commerce platform in Latin America), and its importance is no less than that of Alipay and Taobao.

At the same time, Epay also provides the same level of security and encrypted technology as banks to protect customer's privacy and property security. For domestic cross-border e-commerce practitioners who want or have already entered the Chilean market, Epay Remittance can provide you with a more professional payment solution, providing an exchange service between Chilean pesos and US dollar or euro, and a fast payment gateway service.