All over the world, mobile POS (mPOS) has made a significant impact on small and single outlet merchants.

But there’s evidence to suggest that, among growth markets, Mexico has embraced the concept more enthusiastically than most…

Merchants like this because it’s cheaper than purchasing a traditional dedicated card reader, and the approval process for getting one is far quicker – sometimes as little as 24 hours compared to many weeks.

mPOS also gives retailers more flexibility. They can take card payments wherever they choose rather than solely at a counter top.

Clearly mPOS only works when a good proportion of consumers have bank accounts and cards. And in Mexico, this number is rising fast.

A 2015 report by Timetric revealed that, though cash is still the primary payment instrument in Mexico, there has been real progress in reducing the unbanked population. So, for instance, Mexico’s official ‘development bank’ Bansefi worked with MasterCard to distribute social payments using a basic pre-pay debit card offered free of charge. Cardholders can also access loans, savings and accident insurance through the card.

Timetric revealed that such initiatives increased the percentage of the Mexican population holding a bank account from 27.4 per cent in 2011 to 39.1 per cent in 2014.

The government has also been actively involved in encouraging mPOS. It recognises that the product can help smaller merchants to compete in a more financially sophisticated economy. They must, because there are so many of them. Indeed, according to Omlis, of Mexico’s 1 million grocery retailers, 64 per cent are ‘mom-and-pop’ stores.

So in November 2014, the Mexican tax authority Sistema de Administración Tributaria and the Confederación de Cámaras Nacionales de Comercio, Servicios y Turismo launched a scheme called ‘Tableta Concanaco’.

The idea was to offer micro-merchants and SMEs with mPOS terminals at subsidized rates. By February 2015, they had shipped out 20,000 readers, with a target to hit 100,000.

All of the above is making Mexico more attractive to mPOS companies. Today, according to Mobile Payments Today, multiple providers are competing for a slice of the market.

They include:

• Banamex – launched S-Pay and a product called iAcepta that offers low-cost mPOS terminals to retailers for US$33.6 (MXN500).
• iZettle – Sweden’s mPOS powerhouse has offered its card readers in Mexico since June 2013 through a partnership with Banco Santander.
• AnywhereCommerce – Canadian firm supplying mPOS technology to Prosa’s member banks.
• Sr. Pago – Mexican firm worked with MasterCard and microfinance institution Te Creemos to launch the Sr. Pago Card System. This lets merchants accept card payments, then transfer that money to a MasterCard debit card, and then make purchases with the card. Raised $1m in 2014.
• Mozido – Active since 2012, starting in Yucatán.
• Clip – Mexico City-based firm that raised an $8 million round in 2015.
• Swiff – launched in partnership with a payment solutions provider Affinitas under the Mikit brand.
• Powa Technologies – UK firm entered the market with POS software maker Sophitech.