PART 1: COLOMBIA & UAE
Executive summary
This is the first in our series of Global Expansion Guides to High-Growth Markets. Here we focus on Colombia and UAE: the key market opportunities and challenges, and outline strategies for expanding into these countries.
Subsequent reports will focus on Brazil, South Africa, Mexico, Hong Kong, Chile, and India. Each report aims to provide an actionable strategy for growing your business in these high-growth regions around the world.
High-growth markets are critical engines for global economic growth, driven by expanding digital infrastructure, rising middle-class populations, and increasing internet and mobile penetration.
Many of these countries are at the forefront of these trends, with innovations like real-time payments, digital wallets, and increased mobile penetration accelerating the adoption of eCommerce.
While the financial opportunities are abundant, to successfully expand an online business into these highgrowth areas, merchants should consider key challenges, including:
• Complying with nuanced eCommerce and payment regulations whilst minimizing transaction declines
• Offering consumers’ preferred payment methods
• Localizing currency, pricing, and language options
• Keeping up to date with wider demographic and technological trends
Without a local entity, online merchants run the risk of high foreign exchange fees and poor authorization rates in high-growth markets. Partnering with Merchant of Record, meanwhile, allows international businesses to trade like a local one, without setting up a foreign presence.
Nuvei is an industry leader in helping businesses successfully navigate global expansion pain points. This expansion guide to high-growth markets outlines the key opportunities and how to address local obstacles, ultimately helping merchants build and execute their globalization strategies.
With real payments experts across the globe, Nuvei offers ambitious expanding businesses on-the-ground consultancy, a vast acquiring network, over 700 local and global payment methods, Merchant of Record services, and faster settlement in complex regions.
Introduction
The rising importance of high-growth markets
High-growth markets have emerged as significant drivers of global economic expansion. Countries such as India, Brazil, Colombia, and the UAE are witnessing exponential growth in eCommerce, fueled by favorable demographics, a rapidly expanding middle class, and advances in technology.
For instance, the eCommerce market in Colombia has surged from $13 billion in 2019 to $41.8 billion in 20231, while in the same year the UAE saw 58% of its eCommerce driven by cross-border transactions2.
The rise of financial inclusion through real-time payment systems like India’s UPI and Brazil’s PIX has made digital payments more accessible, bringing millions of unbanked individuals into the formal financial system.
Digital financial inclusion saw huge expansion during the pandemic, and platforms such as these leveraged this trend obtain higher adoption by offering a seamless, more costeffective payment solution.
A combination of factors has propelled these high-potential markets to the frontline of the global digital revolution, starting with their relatively young and tech-savvy populations. The world’s emerging economies are home to 6.82 billion people, or 86.1% of the global population3
In three years, nine out of ten Gen Z and Millennial consumers will be in these markets. In 2024 alone, there will be 113 million new consumers, with over 70% of them from developing economies4.
Nuvei helps businesses expand into these high-growth markets by offering bespoke payments consultancy and tailored payment solutions. These include support for real-time payment systems and localized digital wallets, enabling businesses to adapt to regional payment preferences efficiently and seamlessly.
Key drivers of eCommerce growth in highgrowth markets
Several factors are driving the growth of eCommerce in high-growth markets:
• Favorable demographics:
Significantly sized populations of young, tech-savvy consumers are rapidly adopting online shopping and mobile payments. For example, in Colombia, 82% of eCommerce is mobile based.5
• Middle-class expansion:
The rise of disposable incomes has spurred online retail growth, particularly in India, where 33 million6 new consumers are expected to join the middle class by 2024.
• Financial inclusion:
In a decade, the percentage of the adult population owning a financial or mobile-money account grew from 39.5% to 73.5% in Latin America.7
Businesses can harness these growth drivers by optimizing their storefront and payments page for mobile devices, catering to the payment needs of the consumers in their target region.
Payment trends in high-growth markets
As eCommerce in high-growth markets evolves, several payment trends have emerged:
• The rise of real-time payments: Systems like PIX in Brazil, PSE in Colombia, and UPI in India have revolutionized near-instant payments, with PIX used by 90% of the adult population in Brazil8 and UPI processing 100 billion transactions in India in 20239
• Surge in digital wallets: Digital wallets are gaining traction across emerging markets, accounting for 50% of global eCommerce spend.10 In Colombia, Nequi and Daviplata are among the most popular wallets
• Enduring role of cards: Despite the rise of alternative payment methods, credit and debit cards remain relevant in high-growth markets where 56% of eCommerce transactions are card-based11
• International transaction uptick: Across the high-growth regions, cross-border eCommerce is expected to grow at a 24% CAGR by 202712
• Vertical-specific advantages: Sports betting, particularly after positive regulatory legislation in LATAM, and video gaming are rising industries in these high-growth markets. Online travel is also a rising trend, accounting for 15% of all eCommerce spend both in the UAE and South Africa. In Brazil, the share of this sector is 16%.13
Market focus:
UAE & Colombia
United Arab Emirates
The UAE is a high-income market with a population of 9.5 million and a 2023 GDP of US$504 billion15. Known for its world-class infrastructure, the UAE has become one of the leading eCommerce hubs in the Middle East. Government initiatives like the UAE Digital Economy Strategy aim to double the contribution of the digital economy to GDP from 9.7% in 2022 to 19.4% by 203216, reflecting the country’s commitment to digital transformation.
In 2023, eCommerce penetration in the UAE was 72%, with an estimated US$10.3 billion generated from eCommerce for goods and services.
This figure is expected to grow at a 12% CAGR, reaching US$16.3 billion by 2027.17 A significant driver of this growth is cross-border eCommerce, which accounted for 58% of online sales in 2023, with US$6 billion in cross-border transactions expected to rise to US$10.1 billion by 2027 as around 88% of the UAE population consists of expats.18
To foster favorable eCommerce conditions, Dubai CommerCity (DCC) provides a unique eCommerce ecosystem to global and regional brands to help them set up and operate their online businesses in the MENA region, including exemption from corporate and income tax, fast and automated registration and licensing, and 100% repatriation of capital and profits.
Payment methods in the UAE
• International credit cards dominate online payments, accounting for 60% of eCommerce transactions in 2023, projected to rise to 63% by 2027.20
• Buy Now, Pay Later
The UAE has emerged as the hub of a thriving BNPL industry in the Middle East, featuring strong domestic players such as Cashew, PostPay, Spotii, Rise, and Tabby’, representing 8% of sales in 2023, the highest among high-growth markets analyzed.21
• Digital wallets in the UAE account for 6% of eCommerce payments and are expected to increase to 8% by 2027. This includes local brands include Careem Pay, and Payit as well as international brands like Google Pay, Apple Pay, Samsung Pay, and the Chinese wallets WeChat Pay and AliPay.22
• Real-time payments have yet to gain significant traction in the UAE, but initiatives like Immediate Payment Instruction (IPI) and Aani are positioned to disrupt the market in the future.
How to succeed in the UAE:
1. Target the highincome consumers and international community
The UAE has a high-income population and a significant expat base (88% of the population), with strong ties to global markets. 58% of eCommerce in the UAE is crossborder, providing opportunities for international businesses.23
Offer luxury, premium products, and more sustainable (or ‘slow fashion’) to this market. Use international brands and crossborder shipping to cater to the affluent expat population, especially in Dubai and Abu Dhabi, which represent the majority of eCommerce sales.
2. Leverage digital wallets and embedded financial services
Digital wallets such as Apple Pay and Google Pay are growing in popularity with the Emirati consumer base, and Buy Now, Pay Later (BNPL) is a rising trend, accounting for 8% of eCommerce sales in 2023.24 This trend is expected to continue with the rise of local and regional players like Tabby.
Integrate embedded finance options like BNPL and digital wallets like Careem Pay to offer flexible payment solutions and drive conversions among younger, budget-conscious shoppers.
3. Capitalize on international sales with localized offerings
Cross-border eCommerce is projected to grow at a 14% CAGR in the UAE, from $6 billion in 2023 to $10.1 billion by 2027. Many UAE residents prefer purchasing international products but localizing the shopping experience remains essential.25
Localize your website with multiple language options including the option for Arabic, use local logistics providers, and offer regionally popular payment methods like Islamic credit cards to tap into the growing cross-border eCommerce market.
4. Focus on the rapidly growing online travel and retail sectors
The travel sector is one of the fastest growing in the UAE, expected to grow from $1.6 billion in 2023 to $3.1 billion by 2027. Retail eCommerce is also projected to grow significantly.26
If your business operates in these sectors, consider building partnerships with local eCommerce platforms such as Amazon.ae and Noon, or creating a proprietary eCommerce channel. Leverage the UAE's expanding digital infrastructure to offer localized experiences in these key verticals.
Luxury UAE retailer sees 30% approval rate upgrade in UAE
Located in the largest shopping center in the world, and positioning itself as the ultimate online retail experience, this luxury retailer offers immersive experience, exclusive services, and a wide range of luxury products for contemporary women and men.
As one of the most distinguished shopping centers in Europe and UAE, and a luxury omnichannel retailer, its online shopping experience had to match its joyful, creative in-store experiences. Yet with limited data insights and an anti-fraud payments system that was not optimized for the local market, the retailer faced low authorization rates resulting in missed sales and a drain on revenue.
Nuvei worked with the luxury retailer to drive up approval rates and maximize conversion with its intelligent payment optimization technology. Nuvei’s smart routing engine enabled the luxury retailer to intelligently route its transactions to different banks to maximize payment success. Nuvei’s 3DS engine allowed the retailer to predetermine customized rules on which transactions to pass to 3DS2, 3DS1, or none, whilst remaining compliant and minimizing fraud.
By using Nuvei’s payment optimization technology, specifically Smart Routing and its 3DS engine, the retailer overhauled their acceptance rates by 30%, from approximately 60% to over 90%. This meant far fewer declined transactions, more revenue for the retailer, and happier, satisfied consumers.
Nuvei supports businesses operating in the UAE by offering integration with local and international payment methods like digital wallets, enabling merchants to capitalize on the growing mobile-first consumer base.
Additionally, Nuvei’s local acquiring presence simplifies payments for international merchants, providing solutions that streamline operations in a market where 58% of eCommerce is cross-border.
“A key characteristic of UAE consumers is the strong preference for luxury goods, which opens considerable opportunities for some eCommerce segments. Dubai serves as a major hub for luxury buyers from around the world, in addition to having an affluent domestic consumer base. It is no surprise, then, that the UAE boasts several start-ups specializing in the online sale of luxury or high-value items, such as The Luxury Closet and Ounass.”
Yohann Marnet |
Vice President Sales | Middle East | Nuvei
POPULATION OF 52 MILLION PEOPLE
Colombia
ECOMMERCE IN COLOMBIA REACHED US$41.8 BILLION IN 2023 BOGOTÁ REPRESENTS 46% OF THE COUNTRY’S TOTAL ECOMMERCE SALES
Colombia, with a population of 52 million and a GDP of US$363 billion, is the third-largest eCommerce market in Latin America, behind Mexico and Brazil. In 2023, eCommerce in Colombia reached US$41.8 billion, which was 10% of the country’s GDP, a significant rise from US$13 billion in 2019. By 2027, Colombia’s eCommerce market is projected to nearly double to US$80.8 billion, reflecting significant opportunities for merchants.27
Bogotá, the capital, represents 46% of the country’s total eCommerce sales, followed by the Antioquia region with 22%, and Valle del Cauca with 13%.28 Cross-border eCommerce was valued at US$4.9 billion in 2023 and is expected to grow to US$10.7 billion by 2027, though its share of the overall eCommerce market is projected to decrease slightly from 15% to 13%.29
It’s worth noting that international merchants no longer need a legal entity to operate in Colombia, but paying local taxes are still a requirement. The law says that nonresident individuals or entities with a ‘significant economic presence’ (for example, a substantial customer base) are subject to taxes based on income from the sale of goods and/or the provision of services on Colombian territory.
Having a payments partner on the ground will help online businesses navigate these complexities around compliance and taxation, streamline regulations and adhere to local consumer preferences.
Payment
methods in Colombia
• International credit cards were the most used payment method in 2023, representing 42% of online sales, while bank transfers made up 33%. By 2027, bank transfers, largely driven by the popular Pago Seguro en Línea (PSE) system, are expected to take the lead with 41% of eCommerce transactions.30
• The share of cash payments has declined significantly, from 17% before the pandemic to 4% in 2023, and is projected to fall further to 2% by 2027.31
• Digital wallets, such as Nequi and DaviPlata, have seen increasing adoption, now accounting for 5% of eCommerce transactions, up from virtually zero in 2017.32
• Buy Now, Pay Later Colombia’s share of Buy Now, Pay Later (BNPL) payments, though small at 4%, is one of the highest in Latin America. A leader in this segment is Addi, one of Latin America’s main BNPL startups.
How to succeed in Colombia:
1. Leverage mobile-first eCommerce platforms
Colombia has a highly mobilefocused eCommerce market, with 82% of eCommerce transactions conducted via mobile devices.33
Businesses should prioritize optimizing mobile experiences, ensuring fast load times, intuitive navigation, and mobile-friendly payment options.
Implement mobile wallet payment methods like Moviired and DaviPlata with your payment provider. Ensure your interface offers mobile-optimized content and a frictionless mobile checkout experience.
2. Adopt local payment methods
Bank transfers, particularly through Pago Seguro en Línea (PSE), are gaining dominance in Colombia. By 2027, bank transfers are expected to account for 41% of eCommerce transactions, surpassing credit cards.34
Integrate PSE and other popular payment methods such as Efecty, Baloto, DaviPlata and Nequi to avoid losing out on a large portion of sales. Localizing payment options can boost trust and sales conversions.
3. Capitalize on the growth of international eCommerce
Cross-border eCommerce in Colombia is projected to grow from $4.9 billion in 2023 to $10.7 billion by 2027.35 Colombians are increasingly shopping from international merchants due to better product variety and prices.
Ensure your business offers competitive shipping rates and local and international payment methods to attract Colombian customers shopping internationally.
In addition, implement faster payouts and settlements through your payments partner and third parties with extensive networks like Mastercard Move, so refunds or split payments are more easily managed locally.
4. Take advantage of growing eCommerce categories
Electronics, fashion, and gaming are among the fastest-growing categories in Colombia’s eCommerce market. The gaming sector alone is expected to double in size by 2027, reaching $4.3 billion.36
If your business operates in these sectors, focus on localized marketing and promotions to tap into Colombia’s expanding middle class and youth demographic.
“In Colombia, there is a strong preference for international brands, which makes it difficult for local companies to win over Colombian customers. Indeed, in our case, it was much easier to break into in foreign markets like Chile and Peru, and then return with greater credibility to overcome that preference for foreign brands.”
“The increased appetite for foreign products and services in Colombia likely helps explain why cross-border commerce is expected to double in the country by 2027.
Some Colombians look for better prices abroad, but a greater variety of products and better quality are also drivers of cross-border sales.”
Juan Schultze | Associate General Counsel in Latin America | Nuvei Miguel Celis | CEO | Autocore
Joint market summary
The UAE and Colombia are two distinct high-growth markets, each offering unique opportunities. In the UAE, a high-income population drives the dominance of international credit cards, while cross-border sales and BNPL are growing trends.
In contrast, Colombia’s young, techsavvy population prefers mobile-first payments, with bank transfers and digital wallets gaining prominence.
Nuvei enables businesses to navigate both markets by offering localized payment solutions, supporting crossborder transactions, and integrating digital wallets to enhance the consumer payment experience.
Nuvei provides businesses in both the UAE and Colombia with global and local solutions, including support for popular digital wallets like DaviPlata in Colombia, and Apple Pay and Google Pay in UAE.
This approach allows businesses to seamlessly integrate into the payments landscape of each region.
Overcoming barriers:
Navigating regulatory and consumer challenges
Expanding into high-growth markets involves overcoming several challenges, including regulatory complexity and consumer trust issues:
• Regulatory complexity: Markets like Brazil and Colombia have stringent regulatory frameworks around data protection, crossborder transactions, and payment security
• Consumer trust: Establishing trust in digital payments is key to success in high-growth markets, particularly in regions where fraud rates may be higher
Nuvei provides payment methods that align with consumer behavior in each market, facilitating seamless transactions and building trust. With local expertise and smart routing technology, Nuvei helps businesses navigate these barriers and manage regulatory compliance without losing revenue.
Future trends:
The role of technology in payments
The payments landscape in highgrowth markets is evolving rapidly, with several key trends set to shape the future:
• AI in fraud prevention: AI-driven solutions are becoming essential for preventing fraud and optimizing payment experiences in high-growth markets. Nuvei’s AI-powered fraud detection ensures businesses can safeguard their transactions against threats.
• Blockchain and crypto integration: Blockchain and cryptocurrencies are gaining traction in emerging markets as viable payment alternatives, particularly for cross-border transactions.
Nuvei is at the forefront of technologies like AI, blockchain, and stablecoins support, providing businesses with future-proof payment solutions that can scale with market demands.
By using advanced technologies like AI, complex data analysis, and machine learning Nuvei optimizes customers’ payments, reduces fraud and improves transaction success in complex regulatory landscapes.
Nuvei supports all stablecoins, including merchant-minted coins and USDC across 14 blockchains with 24/7 settlements. Stablecoins lower costs, enhance supply chain cash flow, and speed up cross-border payments and remittances.
Choose a partner that specializes in high-growth markets
Nuvei offers a comprehensive payment solution tailored for highgrowth markets, supporting realtime payments, localized digital wallets, and multi-currency crossborder transactions. With over 700 alternative payment methods and AI-driven fraud prevention, Nuvei provides businesses with the flexibility, security, and scalability needed to succeed in these dynamic regions.
By partnering with Nuvei, businesses can confidently expand into high-growth markets, leveraging localized expertise and cutting-edge technology to deliver seamless payment experiences.
Local expertise and flexibility:
Nuvei’s human-led support and global acquiring network make it simple to expand into new markets without switching partners or acquirers.
End-to-end solutions:
Nuvei’s payment platform supports everything from fraud prevention to cryptocurrency integration, making it the ideal partner for businesses expanding into high-growth markets.
Global reach:
Nuvei supports over 700 alternative payment methods (APMs), enabling businesses to tailor their payment strategies to local preferences in highgrowth markets.
Faster settlements:
Nuvei offers real-time payments and payouts, and immediate access to funds, which is critical for maintaining liquidity in fast-moving markets.
Scalability and compliance:
With compliance expertise across multiple jurisdictions, Nuvei helps businesses scale while staying aligned with local regulations in highgrowth regions.
Merchant of Record:
Nuvei offers merchant of record services, allowing its customers to process payments like a local business without a physical presence, significantly simplifying local tax implications and regulatory requirements.
Methodology and approach
To develop the data and analysis on each market in the PCMI eCommerce Datapack, PCMI first compiles all publicly available data from official sources, including central banks, banking authorities, company financial reports, chambers of commerce, eCommerce associations, fintech associations, local press, market reports and government statistics, as well as data from the World Bank and affiliated international organizations. The PCMI team analyzes the data with a critical approach, identifying the holes, errors, and inconsistencies in this data to prepare it for primary research. Then, PCMI conducts interviews with local eCommerce industry stakeholders to clarify, deepen, and streamline data collected via secondary research.
In the 2024 creation of this dataset, PCMI interviewed over 80 eCommerce executives including banks, acquirers, payment gateways, payment service providers, merchants, and consultants. Finally, PCMI conducts a rigorous analysis of the primary and secondary results, leveraging the perspective of our historical data collected since we first began building this dataset in 2015, to arrive at the final results.
The methodology takes a top-down approach, utilizing macro industry data and the perspective of industry aggregators (i.e. acquirers, PSPs) rather than a bottom-up approach, based on consumer surveys.
To the extent possible, the dataset is built using real, official numbers, such as official credit and debit card volumes, bank transfers and other official reporting of payment methods. Primary research combined with institutional knowledge are combined to make the needed estimations and assumptions to arrive at all breakdowns in the dataset. Projections are calculated based on the opinion of industry stakeholders and accounts for factors such as inflation, GDP growth and regulation.
PCMI avoids making projections based on the launch of new products or features, due to the unpredictable nature of such launches. Please note, PCMI reserves the right to revise historical data as new information becomes available.
How do we define eCommerce?
In this data set, our eCommerce analysis covers all online purchases of goods and services, regardless of the device or payment method used.
Our analysis includes:
• Purchases made by local citizens using all locally-issued payment methods
• Cross-border purchases made with locally issued payment methods
• B2C and B2B purchases that move through an eCommerce checkout
• All product and service verticals, including travel, retail, and digital goods and services.
Retail is defined as: All physical products purchased directly from the merchant or marketplace
Travel is defined as: Travel services including airline tickets, car rentals, tour packages, hotels and AirBnB stays
Ride hailing and delivery is defined as: Digital services that include services including ride-hailing and delivery apps
Online gaming is defined as: Spend on online games or in-game purchases, which can be played via mobile, desktop, or a dedicated console. This does not include sports betting, online gambling or games of chance
Online streaming is defined as: Video and music streaming, typically purchased as a subscription
Other is defined as: Additional digital goods and services including sports betting and online gambling, online education, digital downloads, mobile top-ups, and recurring purchases such as monthly bills, insurance payments, school tuition payments, home ownership association fees, parking, taxes and government licenses and fees if they are paid online over an eCommerce gateway.
These expenses are not included if they are paid online via online banking or direct debit from a check or savings account.
Recurring payments to a credit or debit card are included, as are one-time payments over an online ACH portal such as Botón PSE in Colombia.
SaaS is defined as: The purchase of software delivery accessed via cloud services, rather than through the installation of said software on a computer or other device. Our data includes SaaS purchases made via an online website/checkout process, including subscription and recurring payment models, i.e. Microsoft Office, Slack, Hubspot, Canva, Dropbox, etc. These may be used for both consumer and business purposes and both are captured in our data.
We do not include SaaS purchases that are not made through an official online checkout, such as invoice payments via online banking or wire transfer.
All locally issued payment methods including:
• Locally issued credit and debit cards, online bank transfers, cash payment platforms such as Oxxo in Mexico or Fawry in Egypt, digital wallets such as PayPal, MercadoPago, ApplePay, cash on delivery, and other miscellaneous payment methods.
Please note the following definitions:
Cash Payment is defined as:
A payment platform that enables a shopper to make an online order, receive a bar code or unique PIN and use that bar code or PIN to make the payment in cash at an affiliated retail location. Such platforms often allow payment using an online bank transfer. Examples include Oxxo in Mexico and PagoFácil in Argentina
Digital wallet:
PCMI defines a digital wallet as a payment method that stores any funding source on file, including a credit card, debit card, bank account, or stored balance, and uses that funding source to remit payment.
eCommerce volume falls into the digital wallet category if the wallet brand is selected at checkout, even if a different funding source (such as a credit card) is ultimately selected as the funding source. Examples include staged wallets such as PayPal, TigoMoney and MercadoPago.
Please note: Tokenized card wallets, or passthrough wallets, such as ApplePay, are included under credit and debit card volume.
Bank Transfers:
When applicable, PCMI names the specific bank transfer scheme, such as UPI or Pix. If the bank transfer scheme is selected at checkout, this volume is classified as the bank transfer scheme, not the bank or digital wallet ultimately used to execute the payment.
BNPL:
is defined as a payment button offered by a BNPL fintech that enables the shopper to finance the purchase at the time of checkout, with multiple payment methods, including credit cards, debit cards, bank transfers or cash. BNPL offerings that take place within a wallet ecosystem (such as MercadoCrédito) are not considered here.
Hybrid payment methods:
Payment methods that group several of these payment methods under one brand are specified by their name, i.e. PagoEfectivo, Fawry.
Our analysis excludes:
• Payments made by international visitors with internationally issued payment methods
• P2P payments
• Sales made over social media and paid for in cash or using an A2A payment solution
Country specific notes
• In South Africa, InstantEFT is considered within bank transfer payment methods OZOW and Stitch.
Other technical specifications
• Unless otherwise stated, all currency is expressed in US dollars.
• Please note that numbers contained in figures and tables may not add due to rounding.
Please note, our numbers may not include sports betting or online gambling volume paid via cash voucher or other volume that falls outside the purview of card acquirers and bank transfers.
