Best Payment Gateway for High-Risk Businesses in LATAM: A Complete Guide

For high-risk businesses, managing payments presents a unique set of challenges, with merchants facing high chargeback rates, stricter cross-border regulations, and higher fraud risks compared to regular businesses.

When you add the Latin American (LATAM) market and its payment options to the mix, these issues become even more nuanced. With LATAM becoming a burgeoning e-commerce market, high-risk businesses need to choose the right payment gateway if they wish to attract and retain a wider customer base.

With a reliable payment gateway, high-risk businesses in LATAM can overcome initial challenges and flourish in one of the world’s fastest-growing digital economies. In this guide, we’ll break down:

• The uniqueness of LATAM’s payment structures
• Features high-risk merchants in LATAM should seek in payment partners
• The best payment choice to help LATAM businesses succeed

Why LATAM is a Unique Market for Payments

Latin America is home to millions of digital-first consumers who are slowly but surely shifting toward online spending, making it hard for high-risk businesses across the travel, gaming, CBD, and adult entertainment sectors to ignore. But here’s where it gets complicated: the payment habits of LATAM consumers are far from homogenous; in fact, they vary widely.

For example, Brazilian consumers widely use Pix, an instant payment method managed by the country’s monetary authority, whereas Mexico uses systems like OXXO Pay and SPEI. Thousands of miles away in Colombia, payment modes like PSE bank transfers and mobile wallets are gaining popularity.

This creates a diverse landscape, which, while great for consumers, is tricky for high-risk businesses. Using a broad payment mode like international credit cards is not the best option, as it limits your business potential. That’s why using a payment gateway that offers excellent local coverage is essential.

High Payment Decline Rate

High-risk businesses in LATAM, especially in the e-commerce sector, face some of the highest bank decline rates in the world. These are typically brought on by the following factors:

• Inadequate funds are common in LATAM economies, where consumers mainly depend on debit cards.
• Cross-border limits and obsolete fraud detection capabilities contribute to higher payment rejections.
• Card-not-present (CNP) fraud is common in LATAM, prompting banks to carry out an extra layer of scrutiny while approving transactions.
• Transactions aren’t compatible with local payment modes, resulting in rejected payments.

The Best Payment Gateway For High-Risk Businesses in LATAM Payment: Here’s What to Look For

High-risk businesses must be strategic while choosing their payment solutions partner for LATAM transactions. Here are some features they should look for:

Local Coverage: You need to meet your LATAM customers where they are — this means offering preferred payment modes, whether it’s Pix in Brazil or toditoCash in Mexico. Your payment gateway should integrate these local payment methods, saving you time and money while also boosting sales.

Smart Routing Systems: Unlike traditional payment systems, which rely on a single processor for approval, smart routing systems operate strategically. Based on real-time data, they direct transactions through the payment path with the highest chances for approval. This way, even if one processor declines, the transaction is rerouted automatically through another, thus increasing acceptance rates.

Advanced Fraud and Chargeback Management: For high-risk businesses, advanced fraud tools are the need of the hour, with features such as velocity checks and risk scoring to help add a layer of security. They also minimize the chances of chargebacks, helping high-risk merchants stay within the chargeback ratio set by the bank.

Recurring Payment Options: High-risk businesses in LATAM that run a subscription or membership model will benefit from recurring billing options. To activate this, they need a gateway that supports local recurring options such as Pix Automático in Brazil.

Multi-Currency Coverage: LATAM has a fragmented payment system, with customers from each country favoring its own local payment methods and currencies. For high-risk businesses, this means choosing a payment gateway that supports fair multi-currency pricing and flexible settlement options.

Multi-currency coverage works out well for both merchants – by improving approval rates and minimizing FX costs – and customers, who can pay in their local currency without any hiccups.

How Centrobill Helps High-Risk Merchants in LATAM Succeed

Thousands of high-risk merchants in LATAM rely on Centrobill’s payment solutions to grow with confidence. Our gateway, designed with both local market insights and risk management in mind, equips you with the tools you need to succeed in LATAM’s flourishing market.

Here’s what Centrobill offers:

• Integration with local payment methods across Latin America, from PIX, SPEI, and OXXO Pay to cash voucher options like Mercado Pago and PagoEfectivo. It also accepts payouts by local debit and credit cards, wires, crypto, and bank transfers.
• Advanced, built-in risk management tools that detect LATAM’s unique fraud patterns, helping reduce chargebacks, maintain a steady revenue, and keep customers happy.
• Processes payments in local currencies ranging from MXN and ARS to CLP, BRL, and more, helping merchants settle transactions with the most suitable option.
• A mobile-first interface that mirrors the digital spending habits of LATAM’s consumers – so customers can have a smooth, hassle-free mobile checkout experience.
• Streamlined payment processing across the LATAM region, so that high-risk businesses don’t have to deal with multiple vendors or licenses.
• Opportunities for business scalability by helping high-risk businesses adapt to an increasingly competitive market and growing transaction volumes.

At Centrobill, we simplify payment processing across diverse LATAM regions, so you can focus solely on building and growing your business. Partner with Centrobill today. Contact our expert team to learn more about our specific services.

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