Paramount on Supporting a Diverse Payments Mix to Boost Streaming and Subscription Services in Latin America

Consumers around the globe have tuned in more heavily to entertainment on their TVs, mobile phones and other digital device during the past two years, causing a surge in growth within the virtual streaming industry.

Streaming services have taken off quickly within Latin America, and the region now represents the second-fastest-growing streaming market globally. This makes expansion into the region the next natural step for today’s streaming services as they look to add subscribers outside saturated markets such as the United States and Europe.

Thriving in the Latin American streaming market will require providers to carefully consider the region’s unique payments ecosystem and potential subscribers’ diverse needs, Paul Del Pin, vice president of Marketing and Growth, Streaming Services, Latin America, for streaming and entertainment provider Paramount, told PYMNTS. Many Latin American consumers still rely on cash to purchase digital goods or services such as streaming content, and the adoption of other payment methods varies from market to market.

“The main challenge is that around 70% of adults in the region are unbanked, and cash is still the most popular form of payment,” he said.

Virtual streaming services such as Paramount’s own Paramount+ network must be attuned to shifts in both the Latin American payments space and the streaming market. Supporting a diverse set of payment solutions will be key to ensuring growth in the years ahead.

Bringing Payments Diversity to Streaming

The number of subscription video-on-demand subscribers in Latin America is expected to reach 130 million by 2026, and this means capturing consumers’ loyalty in the market represents a prime opportunity for video streaming platforms. Appealing to new subscribers requires the entire process — from onboarding to the payments experience — to be as seamless as possible. Streaming services looking to seize the opportunity in the Latin American market’s expansion must be careful not to treat consumers’ payment behaviors as a monolith.

“Accessibility is crucial to users, especially in Latin America,” Del Pin explained. “It’s all about understanding the local context and habits. Latin American payment methods in general are very different to the ones used in the rest of the world, and to offer a seamless payment experience, your service must accept payments through any channel.”

Paramount has partnered with a variety of local and international payments players to foster diversity for its Paramount+ subscription service. Del Pin noted that banking saturation levels differ markedly from one country to another, with Argentina, Brazil and Mexico’s populations reporting greater access to financial services than other nations in the region.

Credit and debit card adoption is making progress across the region, Del Pin said, but many credit cards still have low limits and cannot be used outside specific markets. Establishing a presence in Latin America thus requires providing an assortment of payment options and tools across channels to meet consumers’ needs.

“Offering a variety of payment methods is key not only for growth but also for retention,” he explained. “Involuntary churn due to payment error is higher in Latin America than in the rest of the markets, and by offering different payment options, you can tackle this problem.”

Mobile payments in particular have experienced swift growth and adoption within Latin America over the past two years, Del Pin said. He predicted that supporting such payments will be essential for the future expansion of the streaming market throughout the region.

Mobile and Emerging Payment Tools

Approximately 80% of Latin Americans now have smartphones, making such mobile payment options broadly accessible for banked and unbanked consumers alike. Streaming platforms entering Latin America would be wise to develop and deploy mobile-based payments to shore up their regional payments strategies, he said.

“Latin America is transforming, and technology is a key factor,” Del Pin said. “FinTechs and mobile are changing the landscape quickly, and consumers are embracing it.”

Streaming platforms working to enhance subscriber retention and foster loyalty in Latin America will need to adjust their payments strategies to match the needs of the region’s diverse customer base. Taking a mobile-first approach and offering numerous methods across channels will be critical to ensuring smooth subscription payments as the market grows.