Assessing payments systems in Latin America

An Economist Intelligence Unit white paper sponsored by Visa International

Assessing payments systems in Latin America

Preface

Assessing payments systems in Latin America is an Economist Intelligence Unit white paper, sponsored by Visa International. ● The Economist Intelligence Unit bears sole responsibility for the content of this report. The Economist Intelligence Unit’s editorial team gathered the data, conducted the interviews and wrote the report. The author of the report is Ken Waldie. The findings and views expressed in this report do not necessarily reflect the views of the sponsor. ● Our research drew on a wide range of published sources, both government and private sector. In addition, we conducted in-depth interviews with government officials and senior executives at a number of financial services companies in Latin America. Our thanks are due to all the interviewees for their time and insights. May 2005

© The Economist Intelligence Unit 2005

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Assessing payments systems in Latin America

Contents

Executive summary Electronic payments systems Electronic payment products Conventional payment cards Smart cards Stored value cards Internet-based Payments Payment systems infrastructure Clearinghouse systems Card networks International comparisons Electronic payments systems in Latin America Polarized distribution of income Importance of family remittances Financial sector restructuring The evolution of payments systems Argentina The financial sector Governing institutions Banks Clearinghouse systems Electronic payment products Credit cards Debit cards Direct credits and debits Case study: VAT rebates Strengths and opportunities Outlook

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Brazil The financial sector Governing institutions Banks Clearinghouse systems Electronic payment products Credit cards Debit cards Smart cards and pre-paid cards Direct