Digital Payments Trust in Latin America and the Caribbean

Jeniffer Rubio () and Ana Belén Tulcanaza-Prieto
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Jeniffer Rubio: Grupo de Investigación Centro de Investigaciones Económicas, Universidad de Las Américas (UDLA), Vía a Nayón, Quito 170124, Ecuador
Ana Belén Tulcanaza-Prieto: Grupo de Investigación Negocios, Economía, Organizaciones, y Sociedad (NEOS), Escuela de Negocios, Universidad de Las Américas (UDLA), Vía a Nayón, Quito 170124, Ecuador

Economies, 2025, vol. 13, issue 5, 1-18

Abstract: The adoption of electronic payments has increased globally, driving economic growth by enabling smoother transactions. Digital payments enhance speed, security, trust, and efficiency, prompting governments to implement policies that promote financial inclusion through new payment technologies. However, trust in the financial system is crucial for adoption, given concerns about security, fraud, and data breaches. In Latin America and the Caribbean, where economies are vulnerable to external financial shocks, and trust in financial institutions is low, digital payment adoption presents both financial and social challenges. This study analyzes the impact of financial trust on the likelihood of using digital payments in 17 countries, based on the 2023 Latinobarómetro survey (19,205 individuals). Using logit models, it examines financial trust’s influence across income levels. Results show that trust in financial institutions increases the likelihood of digital payment adoption by 62%, with a stronger effect among high-income individuals. Younger age, higher education, and mobile phone ownership also correlate positively with adoption. This study highlights the need to foster financial trust to boost digital payments, enhance financial inclusion, and reduce cash usage—key for tackling inequality and informality. A major limitation is the lack of longitudinal data for further analysis.

Keywords: digital payments; financial system; financial and digital trust; Latin America and the Caribbean (search for similar items in EconPapers)
JEL-codes: E F I J O Q (search for similar items in EconPapers)
Date: 2025
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