Portugal may have found a savior for its economy. Though slowly improving, the country still has much to do in order to fully regain its strength in the domestic and global marketplace. They may have found an answer in ecommerce.
Online shopping and other internet-based transactions are booming in Portugal. In 2016, research shows that the Portuguese ecommerce market was worth an estimated 4.2 billion euros (5.05 billion USD).
Individual businesses are seeing big gains as well, with 1 out of every 10 Portuguese online businesses seeing 100% growth in 2016. This growth is showing no signs of slowing down. By 2021, estimates suggest that Portugal will be home to 7.2 million online shoppers. With the coastal country’s population topping out at around 10 million, that’s a big chunk.
So, what strategies is Portugal using to take advantage of the ecommerce eruption? What’s all this got to do with you? Here’s how it affects your business.
The Digital Single Market Initiative
A major factor in Portugal’s ecommerce boom is the European Union. An EU-member nation, Portugal’s economy is majorly affected by the strategies and programs the union puts in place.
The EU Digital Single Market Initiative is an extension of the traditional market initiatives. Since its inception, the EU has tried to connect the markets of all member nations, to ease the flow of trade and promote globalization.
The DSMI hopes to do the same, through the internet. The plan is to reduce barriers, regulatory or not, and to unlock further online opportunities. Currently, the 28-member markets are fragmented, at least in internet terms.
This may be at the heart of Portugal’s increased ecommerce, and can only further connect markets that the country relies on for trade. Much of Portugal’s economy is based on imports and exports, so opening the online space will have a major effect on improvement.
How this Affects You
If your business already works with Portugal, the benefits are clear. Diversifying the Portuguese market through online business means more opportunities for international businesses trading online, and more money being pumped back into the country’s economy. More money means more business opportunity, more suppliers, and a larger customer base.
If not, same goes. The increase in online activity means that Portugal becomes a much more viable option for international businesses. Once again, other EU markets are accessible through this mending of fragments.
Increased traffic to online-based businesses means increased online payments. Physical tender is on its way out, and the ecommerce market is leading the charge against it.
Portugal is a prime example of this movement. In 2016, data from the Ecommerce Foundation showed that 3.1 million shoppers bought items online. Once again, owing to Portugal’s relatively small population and its weakened economic state, this is surprising.
More and more, shoppers are vying to pay with e-checks, which allows them to pay for a good directly from their bank account, and can take a few days to process. This method has its cons, but offers some positives as well. For example, customers can use e-checks while never giving up credit card information to the online merchant.
So, B2C and C2B payments are, more than ever, online. But, what about international businesses that are just looking to pay a supplier, or to get paid?
How it Affects You
When your business is looking to go global, it’s impractical and costly to send physical tender. So, payments are generally made in a couple of ways: over the internet, or bank wire transfers.
But, as more innovative options for B2B payments come to light, online and wire transfers are going out of style. Depending on the amount, sending money internationally can be costly, unsafe, and maybe even impossible to send money to your Portuguese supplier or business partners. Well, at least through your bank, or a P2P payment method. With Veem, your problems are solved.
Veem is a global payments solution that helps businesses pay suppliers and business partners across borders. Using innovative technologies, our platform allows you to send your payments safely, quickly, and with less fees than a bank wire transfer. We offer favourable exchange rates, and a payment tracking system that allows us to be as transparent as possible.
What’s not to love?
Start the application process today and simplify your international business payments.