• Jonathan Meiri

How do you pay for Uber? A Worldwide Study in Payment Methods

For most people living in North America this questions may sound trivial, but for many people living outside the US - cash is the preferred method.

The vast majority of Uber users in the United States add their Visa or Mastercard as part of the signup process and never think about it again. Indeed looking at Superfly Insights data over 78% of the Uber rides in the United States are paid with Visa, Mastercard, American Express or Discover Card. PayPal is 3rd in line with just under 9%.



The situation is Russia is even more pronounced. While Visa has just under 50% - together with Mastercard they are the preferred payment method in over 90% of the rides.



Users in Australia also have similar preferences with one exception - PayPal has almost 20% of the rides taking share from both Mastercard and Visa (full disclosure - I was a product manager with the PayPal Mobile in 2006/7 when it launched and always happy to see an integration done right).




A side note about PayPal - looking at the top 30 countries by penetration of PayPal vs cash (on Uber) it's clear that PayPal is yet to capture (1) markets with low penetration of traditional credit cards and (2) high percentage of unbanked.



Brazil for example, a country with over 55M unbanked adults shows a stark contrast with that of the US Australia and even Russia - over 25% of rides are paid in cash.



Finally India with a large unbanked population, over 65% of rides in India are paid in cash. Paytm (India's PayPal) is second place with just over 30%, and Visa and Mastercard are far behind with 6% and 4% respectively.



It is interesting to note that while many people think of credit card as their preferred payment method, in two of Uber's largest ridesharing battlefields, Brazil and India - markets with with massive market opportunity - cash is (still) King.

Who will overtake cash as preferred payment method for developing countries? Will we wait for credit cards to penetrate the unbanked? Maybe PayPal /Paytm solution? Or maybe out of left field a mobile/crypto currency solution?

Notes:

This study was conducted on a two week sample (early May 2017) of Superfly Insightsanonymised e-receipts panel and anonymised SMS receiptsOur overall panel includes 10 million users across 80+ countriesThe Uber data included 9k-12k unique Uber users per day (16k-20k rides rides per day) overall 250k transactionsThe India data was corroborated with anonymised SMS panel of roughly 5M users in India (1M monthly active)Confidence level is 95%, confidence interval (margin of error) is +-3% (for top 3 payment methods AND >10% in each graph)Superfly Insights provides the (1) highly granular data, with (2) worldwide coverage, and (3) best in class correlations with actual numbers. Our focus is on ride sharing, food delivery, retail, subscription services, publicly traded consumers brands.

Finally, here is the graph above withe the appropriate country names (top 5 payment methods)



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