Mexico’s digital economy: Ripe for opportunity

Mexico is a vibrant and fast-growing digital market, with consumers who are highly engaged online. Around four in ten Mexicans make online purchases at least once a week, and eight in ten have shopped from international websites, highlighting a clear appetite for cross-border e-commerce. But behind this digital enthusiasm lies a surprising reality: cash still dominates everyday transactions.

Despite strong internet penetration and mobile usage, less than half of Mexico’s population has a bank account, and adoption of credit and debit cards remains relatively low. For many consumers, especially those outside major cities, the preferred way to complete online purchases is through cash-based methods, often using hybrid payment models that bridge digital and physical channels.

One widely used solution is OXXO Pay, which allows customers to generate a payment reference online and then pay in cash at one of thousands of OXXO convenience stores nationwide. These stores process the payment and notify the merchant digitally, making it possible for cash-reliant consumers to participate in e-commerce.

For international merchants, the growing local preference for OXXO Pay underscores the importance of offering flexible payment options and understanding local habits. To succeed in Mexico, businesses must cater to both digital-first and cash-preferred segments, ensuring a smooth, secure, and inclusive experience across all customer touchpoints.

Market overview of Mexico: Young population, leading cash user in the Americas

GDP and demographics

Mexico has a population of 130 million with a relatively balanced gender ratio. The majority (67%) are of working age (between 15 and 64 years old). Spanish is the official language.

Those 65 and older make up only 8% of the population. This is similar to Malaysia, and below the global average of 9.84%, indicating a favourable demographic dividend with low ageing. The service sector is Mexico's primary industry, representing nearly 60% of the economy. In 2023, Mexico's unemployment rate was just 2.8%, lower than major economies.

Mexico's GDP hit $1.79 trillion in 2023, keeping its place among major economies with a GDP per capita of $13,790. The e-commerce market has been growing steadily, with users reaching 67.9 million in 2023 and expected to surpass 118 million by 2029. Statista projects a compound annual growth rate (CAGR) for e-commerce of 9.62% from 2025 to 2029, slightly above the Latin American average of 9.43%.

Economic drivers

As the world’s 12th largest importer, Mexico saw total goods imports of $621.48 billion in 2023, primarily in electrical and electronic equipment. China ranks as Mexico’s second-largest import source at $114.19 billion, following the United States. Major imports from China include electrical products, auto parts, textiles, furniture, toys, and sporting goods.

Mexico is now a strategic hub for the Chinese automotive industry. Data shows Mexico is the largest source of US automotive imports, with nearly 3 million vehicles worth $78.5 billion in 2024. After Tesla's Gigafactory, Chinese suppliers like Minth, Sanhua Intelligent Control, and Fuao Automobile have expanded in Mexico, while HUAYU and Joyson grew through mergers and acquisitions. Mexico's geographic advantages, favourable policies, and low costs make it ideal for Chinese firms entering North America. In 2023, Chinese automakers held a 10% market share in Mexico, selling 134,000 vehicles, and about 68% of Chinese vehicles were exported through Mexico, indicating strong potential for cooperation between China and Mexico in the automotive sector.

Consumer and payment trends

The informal sector is a vital segment of Mexico’s economy, making up 24.8% of the country’s GDP in 2023. This segment includes unregistered businesses, street vendors, gig workers, and many cash-based service providers who operate outside formal banking systems, with limited access to credit, digital payment infrastructure, or financial documentation. As such, cash remains the most widely accepted and trusted form of payment, particularly in rural areas and low-income urban communities where informal employment is common.

The dominance of the informal economy contributes to the slow adoption of cashless payment methods in Mexico. Many consumers rely on daily or weekly income paid in cash, which is immediately used for household needs without ever entering a bank account. Additionally, informal vendors and micro-entrepreneurs often avoid digital payments due to concerns over fees, taxation, and a lack of technical support.

Financial service penetration in Mexico is also inadequate, with only 49% of those aged 15 and above having bank accounts. Most bank branches are in the capital, leaving remote areas underserved. High interest rates and strict credit checks hinder credit card issuance. In 2024, debit card usage was 36% and credit card usage just 11%, far behind other major Latin American economies.

This environment reinforces the importance of hybrid payment solutions, such as cash-based digital transactions through convenience stores, that bridge the gap between e-commerce and a predominantly cash-driven economy. For online merchants, recognising the influence of the informal sector is crucial to building inclusive payment strategies that meet consumers where they are.

While payment transformation will take time, digital wallets, deferred payments, and Buy Now, Pay Later services help address the shortcomings of traditional financial services as the payment ecosystem evolves.

Consumer trends: Online shopping is the norm

Mexico's GDP grew by 2.1% year-over-year in Q2 2024, according to the National Institute of Statistics and Geography (INEGI). This momentum stems from factors like the nearshoring strategy attracting US investment, as companies move supply chains to nearby and stable regions. Mexico's strategic location makes it a key player in this trend, and attractive to US investments. Moreover, a large consumer market and youthful population boost domestic demand, driving various industries. As incomes rise and consumption improves, this cycle continues to energise the Mexican economy.

The most recent available data on Mexican households’ income and expenditure data from Mexico’s National Statistics Office.

In 2020, Mexico's total quarterly household income reached $99.89 billion, with 63.8% derived from employment income. Transportation and housing dominate expenditures, followed by personal care, education, and cleaning products. Food makes up 38% of household spending, comparable to the Philippines (36%) but much higher than Brazil (20%). This highlights Mexico's rich food culture and focus on quality, reflecting the prevalence of low-income households that prioritise basic needs, resulting in a higher percentage of food expenditure.

Other notable consumer behaviours:

• Collective shopping culture: Shopping with friends and family is a popular social activity in Mexico, with family members jointly participating in significant purchase decisions.
• Payday and holiday shopping peaks: The peak is around mid-month, month-end, and before holidays like Christmas and Buen Fin. Paydays increase funds and influence shopping habits, creating distinct consumption patterns.

Against the backdrop of an improving overall economic environment, Mexico's retail market is flourishing, with explosive growth in e-commerce emerging as a key trend, presenting numerous opportunities for merchants.

Physical retail

Mexico's retail market expanded to $374.9 billion in 2023, with a CAGR of 4.8% projected from 2025 to 2034. Apparel and electronics lead in market shares, followed by food, beverages, and consumer goods. International giants like Walmart and domestic players such as Liverpool Department Store and FEMSA dominate the market with strong brands and established operations. The booming tourism industry, especially luxury hotels, boosts retail by driving new consumer demand.

E-commerce

Traditional retail dominates Mexico's market, with e-commerce at 14.2% in 2023, much lower than in e-commerce leaders like China (47%) and Indonesia (31.9%). However, increased smartphone use and better internet coverage are driving explosive growth in Mexico's e-commerce sector.

Mercado Libre, Latin America's leading e-commerce platform, has dominated since its 2000 launch in Mexico. In January 2024, it recorded 360 million visits and a 44% market share, providing seamless cross-border services through its payment system, Mercado Pago, and its logistics solutions sellers.

Cross-border e-commerce is rising, with over 41% growth expected by 2025. AliExpress has 38.3 million monthly visits in Mexico, ranking third among e-commerce sites, with a 42.55% annual growth rate. SHEIN has reached $918 million in revenue and plans to use local manufacturing to improve logistics and reduce delivery times and costs.

These trends highlight the appeal of Chinese brands to Mexican consumers and the strong potential for cross-border e-commerce in Mexico. Many sellers utilise Mexico as a tax-free transit point, shipping goods to bonded warehouses before sending them to the US as small parcels for tax-free clearance, reducing operational costs.

Statista reports that Mexico's e-commerce revenue hit $31.85 billion in 2023, doubling since 2019. Annual growth is expected to surpass 15% in 2024 and 2025. The average spending per e-commerce user in 2024 was $501, higher than Brazil's $320 and the regional average of $495. This also exceeded the Philippines' spending, showcasing Mexican shoppers' strong purchasing power in developing markets.

In 2023, Mexico had about 67.9 million e-commerce users, with a penetration rate of 70.4%. It is estimated that the number of users will grow to 118 million by 2029, with a penetration rate of 90.2%.

The majority (74%) of adults shop online, with nearly 80% having participated in cross-border shopping. Young and middle-aged users (under 54 years) account for over 92% of this group, slightly skewed towards males (53.2%). Over 70% of online spending comes from middle and high-income groups. Additionally, 85% adopt an omnichannel approach (online orders, offline pickups), with mobile shopping leading at 78% compared to desktop's 22%.

A 2022 survey in Mexico found that 57.5% of consumers shop online at least once per month. While this frequency is lower than that in mature markets such as Brazil and Argentina, it surpasses the online shopping frequency of developing markets such as Peru, Colombia, and Uruguay.

What e-commerce activities do Mexicans engage in? In Q3 2024, respondents indicated that buying products or services was their main activity, accounting for 60%.

Free shipping, coupons, and reviews drive Mexican online shopping, while price hikes, stock shortages, and slow logistics challenge customers. Additionally, 81% of consumers said that lack of information impedes purchases; 74% point to payment issues as the main reasons for abandoning online shopping.

Payment security and convenience are critical issues in Mexico's e-commerce. GRC World Forums reported a 220% surge in e-commerce fraud during COVID-19 and the fraud forms became increasingly complex and diverse: account takeover attacks increased by 239%, in-store self-service terminal fraud increased by 149%, and automated bot attacks extended to the entire purchase process. The situation has caused Mexican banks to take a highly vigilant attitude towards online transactions and reject 37% of order authorisation requests.

Consumers are also wary of online payments due to challenges such as high data breach risks, limited banking services in remote areas, low mobile payment use, and complex payment processes.

AMVO's research shows that 75% of consumers hesitate to share banking information online due to security concerns. Antom Shield offers AI-driven intelligent risk control services, using massive, big data and advanced machine learning algorithms to protect merchants and consumers, reduce fraud losses, enhance dispute resolution, and minimise chargeback risks, ultimately creating a more secure and reliable payment environment.

Mexican consumers often buy clothing, footwear, cosmetics, and skincare products online. Compared to Q3 2023, notable sales growth in Q3 2024 includes home care products (64%), photography products (56%), gardening products (48%), DIY products (41%), and perfumes and cosmetics (38%).

Additionally, 58% of consumers research online before making major purchases; 57% find shopping reviews extremely helpful; and 35% regularly purchase products from different merchants on the same platform.

Digital behaviour

Statista reports Mexico's internet users reached 104 million in 2023, with a penetration rate of 81.2%. Smartphone usage is increasing, with internet penetration projected to hit 98% by 2029.

In Q3 2024, Mexican internet users spent about 7 hours and 32 minutes online per day, and also spent longer periods of time watching television and using social media.

Social commerce has rapidly emerged in Mexico's e-commerce market. In-app shopping features create a seamless experience, boosting conversion rates and supporting small and medium-sized businesses in reaching wide audiences cost-effectively.

In addition to social platforms with a broad user base, such as Instagram and Facebook, TikTok has experienced explosive growth (nearly 30%), becoming the platform with the highest user engagement. As a result, many retailers and brands are partnering with local KOLs on TikTok and other platforms for brand-building and marketing campaigns.

While cash is still the preferred payment method for many Mexicans, cashless payment methods like debit cards and electronic fund transfers are more commonly used for medium and high-value transactions. Consumers are increasingly turning to digital payments for larger or recurring payments like utility bills, electronics, insurance, and travel. Debit cards are preferred for their accessibility and direct link to bank accounts, offering a sense of control over spending.

However, these trends are more evident in urban centres, where access to banking infrastructure, internet services, and financial education is significantly higher. Cities like Mexico City, Guadalajara, and Monterrey have dense networks of ATMs, bank branches, and digital service providers, making it easier for residents to engage in cashless transactions. In contrast, rural and remote areas often lack the infrastructure to support digital payments. Many residents in these regions do not have bank accounts or smartphones, limiting their ability to participate in the cashless economy and reinforcing reliance on cash.

Payment preferences in Mexico: Opportunities for credit

Digital payment users in Mexico have consistently increased, reaching 67.96 million in 2023 with a 52.84% penetration rate. Transaction value exceeded $90.56 billion, ranking fifteenth globally, and is projected to grow at a CAGR of 12.45% from 2025 to 2029. This indicates strong potential for greater digital payment adoption, with users expected to hit 80.8 million by 2025.

ECDB's survey shows Latin American consumers favour digital payments for their speed, simplicity, and contactless capabilities.

As shown in the figure above, in 2024, card payments remain the most popular payment method in e-commerce, followed closely by digital wallets.

Card

The main card brand in Mexico is Visa, followed by Mastercard, which together account for 99% of the market share. Antom supports both brands.

Santander Bank's report shows that credit and debit card usage in Mexico is on the rise. The card payment market hit $157 billion in 2023, with a projected 13% CAGR through 2027. Though credit card approval rates in Mexico are lower than those in other North American countries, credit cards still dominate cross-border transactions and premium purchases, especially for high-end electronics, due to transaction security and cashback benefits. Conversely, debit cards are mainly used for local retail purchases, utility payments top-ups, online digital content, and recharges.

In 2022, credit card transaction volume reached $57.95 billion, while debit card transactions totalled $103.96 billion.

Digital wallets

COVID-19 accelerated digital wallet adoption in Mexico, with 74% of users first using one during the pandemic. Young and middle-aged groups lead this trend, as smartphone usage exceeds 70% among those aged 26-45. The digital wallet market in Mexico is projected to reach $3 billion by 2025 and $6.97 billion by 2030, with an 18.4% CAGR from 2025 to 2030.

Digital wallets are central to Mexico's payment ecosystem, transforming traditional financial services. Statista reports that the use of digital wallets in online shopping has climbed from 2019 to 2023 and is expected to hit 37% by 2027 as the main payment method. Mexican consumers prioritise payment security, with 72% rating authentication highly and 67% valuing better spending visualisation and control.

Which digital wallet services are most popular among Mexican consumers? See the chart below:

Statista reports PayPal leads with 79% market share, thanks to its vast merchant network and mature credit system. 56% of consumers favour Mercado Pago, which serves as Mercado Libre's payment arm and parallels "Alipay + WeChat Pay" in Latin America. It facilitates transactions on Mercado Libre and provides online and offline payment solutions for various merchants, along with transfer, bill payment, top-up, and cash withdrawal services.

In Mexico, where over half the population do not have a bank account, Mercado Pago's digital wallet addresses a vital financial need. Users can easily create accounts with quick personal information verification via mobile phones or computers. Its iconic blue payment terminals are common in traditional markets and other areas, forming a vast payment network for local merchants and consumers.

Antom collaborates with Mercado Pago to help merchants integrate smoothly into this ecosystem, reducing payment processing hurdles and operational complexity costs.

Cash

Despite the rise of digital banking, cash remains prevalent in Mexico, particularly for taxi fares, gas stations, and tolls, with many websites and applications still offering cash options. In 2024, nearly half of the population lack bank accounts, making cash convenient and secure for low-income groups. A Minsait Payments report shows that 92% of respondents plan to continue using cash.

However, Mexico's digital transformation is progressing, resulting in declining cash use year by year. Statista data reveals cash transactions at points of sale fell from 83% in 2018 to 68% by Q2 2024, while online prepaid cash and cash-on-delivery payments dropped by 3% and 21%, respectively.

Post-pay, a type of cash payment, allows consumers to create payment vouchers while shopping online and pay at physical locations such as convenience stores. Although post-pay accounts for less than 1% of payments globally, it reached 7% in Mexico in 2023.

Post-pay expands payment options for consumers without bank cards, making online shopping more convenient options.

Informal credit

In Mexico, informal credit mechanisms such as “tabs” and “tandas” play a significant role in the financial lives of many individuals, particularly in contexts where formal banking services are inaccessible or insufficient.

Tabs, or informal lines of credit extended by local merchants, are commonly used for small, everyday purchases. This practice allows consumers to obtain goods or services on credit, with the understanding that payment will be made at a later date. Such arrangements are prevalent in communities where trust and personal relationships facilitate these informal credit systems, effectively filling the gap left by the limited reach of formal financial institutions.

Conversely, for larger financial needs, many Mexicans turn to tandas, a form of rotating savings and credit association. In a tanda, a group of individuals contribute a fixed amount of money to a common fund at regular intervals, and each member takes turns receiving the total sum collected. This system provides participants with access to substantial funds that can be used for significant expenses, such as medical bills, education, or home improvements.

The reliance on such informal credit systems underscores the necessity for financial inclusion initiatives that address the diverse credit needs of the population, ensuring that both small-scale and substantial financial requirements are met through secure and accessible means.

Bank transfer

Mexico's banking sector shows oligopolistic traits, with seven major banks controlling about 80% of the market, led by BBVA, Banorte, and Santander. Traditional and digital channels have developed in tandem, and digital banking has grown rapidly, with Statista projecting penetration to reach 34.83% by 2026.

Real-time payments are a growing trend in Mexico's e-commerce, valued for convenience. In Q3 2022, online bank transfers hit 24 trillion pesos, with SPEI transactions up 62% in 2021, mainly from small transfers under 8,000 pesos. Based on the SEPEI system, innovative solutions such as CoDi (QR code) and DiMo (mobile payments) are integrated into banking applications, proving that traditional banks can also provide modern payment experiences.

A dynamic market with room to grow

Mexico presents a compelling opportunity for online merchants, thanks to its large, youthful population, rising internet penetration, and steady e-commerce growth. With over 67.9 million e-commerce users in 2023 and projections pointing to 118 million by 2029, digital adoption is accelerating.

Yet, the relatively low use of traditional banking and credit services—especially outside major cities—means businesses must adapt their strategies to local consumer behaviours and payment preferences.

Merchants entering the Mexican market must be prepared to offer a mix of familiar and flexible payment options, including debit cards, digital wallets, and post-pay methods that cater to consumers without access to credit. Security, simplicity, and convenience are key concerns, and earning consumer trust through seamless and secure checkout experiences will be crucial to success.

Beyond payments, understanding Mexico’s unique shopping patterns—such as collective buying, payday-driven peaks, and the growing role of social commerce—can help brands tailor their offerings and marketing efforts more effectively.

From cross-border logistics to omnichannel fulfilment, merchants who localise their strategies while leveraging Mexico’s favourable economic conditions and trade links will be well-positioned to thrive.

How Antom can help you with payments in Mexico

Antom provides convenient and flexible options for global merchants to offer the best support for your business operations. Partnering with Antom brings numerous advantages, such as:

Credit and debit card support: Antom supports credit and debit card payments, offering a range of payment methods accepted globally and locally.

Digital wallet support: Antom maximises payment acceptance with over 250 Asian and global payment methods, including digital wallets in Mexico.

Antom has extensive market experience in various regions, harnessing a deep understanding of local market operations and cultural habits. This enables us to provide practical marketing strategies to online merchants looking to enter the market, minimising entry barriers and ensuring successful development.

Contact us today to start accepting payments from consumers in Mexico.