Amazon may provide Mexico with a government-backed mobile payment system

Mobile payments may soon be coming to Mexico, courtesy of Amazon.

Mexico’s central bank, Banxico, is currently in talks with Amazon to developer a mobile payment system backed by the country’s government. The payment system, known as CoDi, would allow customers to pay for purchases, both online and in-person, using QR codes on their smartphones.

As Reuters points out in its report, more than half of Mexico’s population does not have a bank account. Banxico is looking to change this with CoDi.

SEE ALSO: Amazon will open new grocery stores separate from Whole Foods, report says

According to market research firm Euromonitor International, less than 4 percent of total retail sales in Mexico came from ecommerce last year. The QR code-powered mobile payment service would be free of charge to use, which should help spur growth in the country’s online shopping sector.

Smartphone-powered payment systems have surged in popularity in countries like China and India. In China, for example, nearly half of the country’s population used mobile payments in 2018. Last year, India’s mobile payment usage saw close to a 40 percent increase from 2017.

The mobile payment system, a first for Mexico, would open up a whole new customer base in the country to a new avenue that would allow them to take part in the country’s economy. Mexico’s central bank has clearly seen the success mobile payments have had in other countries and a partnership with an ecommerce giant like Amazon to implement the technology would be a serious bet to place.

Banxico will launch a trial of the mobile payment service later this month.