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Unlocking potential in emerging economies

3 min. read
Unlocking potential in emerging economies

Discover why emerging markets offer compelling opportunities for global business, fueled by significant population growth, economic expansion, and rapid digital adoption. Explore the potential of these dynamic regions.

Emerging markets present a compelling opportunity for businesses, driven by significant population growth, economic expansion, and the rapid adoption of digital technologies.

Take a look at why these regions are becoming increasingly attractive:

Population growth

The global population recently surpassed 8 billion, with a significant portion of this growth occurring in developing economies. Over the last 25 years, the world has seen a one-third increase in population, adding 2.1 billion people. By 2050, the global population is expected to grow by another fifth, reaching nearly 10 billion. Most of this growth is concentrated in Asia, Oceania, and Africa.

The proportion of the world's population living in developing countries has risen from 66% in 1950 to 83% in more recent years, and it’s projected to reach 86% by 2050. This demographic shift offers immense economic opportunities, particularly in Africa, where the working-age population is increasing rapidly.

Emerging markets are characterized by youthful, digitally-savvy populations. For instance, India, a key emerging market, has around 900 million people under the age of 35, nearly three times the entire population of the United States. This demographic is a significant driver of innovation and growth in technology, eCommerce, and digital services.

Economic growth

Emerging and developing economies (EMDEs) are set to contribute 66.7% of global growth in 2024. Growth in these regions is expected to be robust, with projections of 4.1% in 2024 and 4.2% in 2025. In comparison, advanced economies are projected to grow at a slower pace.

  1. Growth in emerging Asia is expected to be particularly strong, with an increase of 5.2% in 2024 and 4.8% in 2025
  2. India is projected to maintain a steady growth rate of 6.5% in both years
  3. Latin America and the Caribbean are also expected to see growth, with projections of 1.9% in 2024 and 2.5% in 2025, driven by Brazil and Mexico
  4. The Middle East and North Africa, as well as sub-Saharan Africa, are projected to see significant growth too

Digital payments and eCommerce

The number of people coming online in emerging markets is increasing rapidly, driving significant growth in eCommerce and digital payments.

  • LATAM eCommerce Market (2028 Estimation):
    • Estimated Market Size: $1.4 trillion USD.
    • CAGR from 2022 to 2028: 16%.
    • Insight: This growth is fueled by increased internet penetration and a growing digital-savvy population.

  • Africa eCommerce Market (2028 Estimation):
    • Estimated Market Size: $0.6 trillion USD.
    • CAGR from 2022 to 2028: 17%.
    • Insight: Factors such as increasing internet and mobile connectivity and evolving consumer behavior favoring online shopping contribute to this robust growth.

 

  • APAC eCommerce Market (2028 Estimation):
    • Estimated Market Size: $1.6 trillion USD.
    • CAGR from 2022 to 2028: 20%.
    • Insight: Technological advancements, a burgeoning middle class, and rising digital literacy drive the highest growth rate in eCommerce in this region.

Our mission

At dLocal, our mission is to bridge the gap between the largest, most sophisticated global companies and consumers in high-growth markets. We enable more than 600 large global companies—from eCommerce stores to digital services, entertainment, travel, and mobility platforms—to accept 900 payment methods in local currencies across 40 countries in Africa, the Middle East, Asia, and Latin America.

The importance of local payment methods

Local payment methods account for 83% of total eCommerce expenditure in the major markets we operate. On a global scale, local payment methods represent an estimated 61% of worldwide eCommerce spend, amounting to approximately $3.4 trillion. For international merchants looking to expand beyond the US and Western Europe, developing a comprehensive local payment strategy is imperative.

Enabling seamless cross-border payments

We take pride in enabling our merchants to grow and succeed by navigating unique payment landscapes in emerging markets. With our simple cross-border payment solution, businesses can handle payins and payouts efficiently, ensuring seamless transactions. This approach is particularly valuable for B2B payments, providing a robust financial solution that meets the needs of global merchants.

As we continue to support our clients in these dynamic regions, we look forward to unlocking even more opportunities in the future. By offering a unified payment solution tailored to local markets, we empower businesses to thrive and expand in high-growth regions, cementing our role as a key player in the world of cross-border payments.

For detailed insights into emerging markets and the evolving landscape of local payments, download our Payments Handbook and see how you can leverage these opportunities. Download your copy here and let us know what you think.

Get in touch with our payment experts

We help global companies such as Amazon, Spotify, and Microsoft find new opportunities in high-growth markets. Let's think outside the box for tailor-made payment solutions for your business. Fill out this form, and we'll get back to you as soon as possible.

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