During the pandemic, Latin America experienced a sharp change in its number of online users, with a notable diversification in the audience of gamblers. According to data from Americas Market Intelligence (AMI), the online casino and betting sector in Latin America will have a turnover of roughly US$10 billion in 2022. In our E-commerce Data Library we include this segment in the digital goods and services vertical, whose e-commerce sales are forecast to grow by 25% in 2022.
Colombia has the largest online betting market in Latin America, with a turnover of US$4 billion, according to AMI data. Brazil’s fairly mature market in terms of online gambling and casinos is expected to have a growth potential of 50% in 2022. This will depend on the regulations being put forward with respect to credit-card payments for online casinos licensed to operate in Brazil.
In a recent AMI Payments Coffee Chat, we spoke to Andrés Roldán, Sales Manager at Nuvei (formerly Paymentez). Nuvei is a payment gateway with a presence throughout Latin America, from Mexico to Argentina, covering much of the region’s online casino transactions.
Here are the main points covered during the chat.
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Legal perspectives of online casinos in Latin America
As mentioned in the chat, Mexico and Colombia are the most advanced countries in terms of online casino and betting legislation in Latin America. In both countries there are solid legal frameworks and government bodies in charge of licensing and monitoring the industry.
We should note that Latin America has varying levels of gambling legislation. Legislation is lax in some jurisdictions, such as Costa Rica, Colombia, and Panama, allowing in international players with an operating license. Other legislations, such as those of Uruguay and Chile, only allow state lotteries. Some countries, on the other hand, are only just developing their legislative framework, while others, like Peru, have no oversight bodies or legislation at all, so there is a legal vacuum or grey area surrounding the use of these types of casino websites.
One of the advantages of regulating the online casino market is that this can lead to the arrival of new players, which can increase the turnover for each country. Another advantage is the diversification of payment methods. In Brazil, for example, they are looking at the use of credit cards for online casinos. In the meantime, payment is only allowed by alternative methods such as Pix, and bank transfers.
For governments, legislation is also an opportunity to be able to tax companies or users for these activities.
Online gambling: daily visits by country
Nuvei’s data offer a clear view of countries in which online gambling and betting are most popular, according to average daily visits to casino websites within a jurisdiction.
It is surprising to see how Brazil ranks number one in the world, outmatching even the United Kingdom. Or how Mexico and Colombia remain among the world top ten.
It should be noted that these data only relate to average daily visits to casino websites; they do not represent either the volume of online bets or the number of active gamblers.
Leading payment methods used in online casinos in Latin America
As part of his presentation in the chat, Andrés Roldán detailed the payment methods most widely used in the online casino and betting industry, in the top five Latin American markets: Brazil, Mexico, Colombia, Chile, and Peru. We offer our summaries of these markets below.
BRAZIL: Preferred payment methods for online gambling, casinos, and betting
Brazil is the biggest online gambling market in terms of daily visits and market volume, although it is not a completely regulated market.
The formal payment methods (those permitted under Brazilian law) for online casinos are bank transfers and APMs. The latter includes Pix, Sodexo, and Itaú Boleto. There are restrictions on the use of debit and credit cards for online games in Brazil.
Nuvei’s data show that Pix is the preferred payment method used for online gambling in Brazil. It is a new alternative to traditional bank transfers.
MEXICO: Preferred payment methods for online gambling, casinos, and betting
In Mexico, the casino market is regulated by the Directorate General of Games and Draws. Permitted payment methods include credit cards, bank transfers through SPEI (and others), and cash at physical sites such as OXXO stores and pharmacies. CoDi is also used as a payment method in online casinos, but its penetration is very low.
According to Nuvei, credit cards are the preferred payment method for gambling in Mexico, the top franchises being Visa, Mastercard, American Express, and Carnet.
COLOMBIA: Preferred payment methods for online gambling, casinos, and betting
Colombia has a regulated, open online casino market. Coljuegos is the organization in charge of monitoring and licensing the online casinos operating there.
Payment methods available in Colombia’s online casinos include credit and debit cards (under franchises such as Visa and Mastercard, but domestic brands like Éxito and Codensa also exist), bank transfers (primarily through PSE), and digital wallets and cash (such as Efecty and Daviplata).
Nuvei’s data show that PSE is by far the preferred gambling payment method in Colombia, with nearly 50% of the payment traffic in online casinos. The second most-favored payment method for gambling in Columbia is cash.
CHILE: Preferred payment methods for online gambling, casinos, and betting
In Chile, it is legal to gamble in online casinos and bet online; however, there is no regulation and no organizations capable of issuing specific licenses to businesses.
In this respect, online casino businesses can receive Chilean traffic and offer gambling thanks to licenses obtained in other countries, such as the Curaçao license. Chile does have its Casinos Regulator, but it has no formal legislation for online gambling.
Payment methods for online casinos in Chile include credit cards, bank transfers, and cash through services such as Servipag and Sencillito.
Nuvei’s data show that cash and bank transfers are the preferred payment methods for online casinos and sports betting in Chile.
PERU: Preferred payment methods for online gambling, casinos, and betting
The case of Peru is similar to Chile—there is no formal regulation. Yet the Peruvian market does have a peculiarity: a specific banking analysis process is required for online casino businesses to be able to offer their users payments by credit card.
The most widely used payment methods for online casinos in Peru include credit cards, bank transfers, and cash—through PagoEfectivo.
According to Nuvei, bank transfers and cash are the preferred methods for making payments at online casinos and for sports betting in Peru.
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Moving beyond the Chat
Our LatAm E-commerce Data Library offers in-depth, historical data on e-commerce and digitization in the region. Click here for more information.
As Latin America’s leading market intelligence company, Americas Market Intelligence conducts research on payment topics, helping companies minimize risk and expand their opportunities for success in the region. We are experts in cryptocurrencies, Buy Now Pay Later, SMEs, mobile wallets, ACH, open banking, and more. Contact us to let us know what your needs are, and to explore the possibilities of conducting a study.
