Emerging Markets 2025: The Rise of Digital and E-Commerce Giants

Published Date: December 9, 2024 | Author: Kevin Carter, Founder and CIO, EMQQ Global

We believe emerging markets are poised for substantial growth in internet and e-commerce sectors heading into 2025, driven by rising internet penetration, digital infrastructure expansion, and growing middle-class populations. Key regions include India, Southeast Asia, and Latin America, each presenting unique opportunities for investors.

Growing Internet Penetration

Rapid digital transformation is underway, with internet penetration projected to grow over 10% annually across emerging markets. India is expected to have approximately 900 million active internet users by 2025, up from 759 million in 2022. This growth represents a significant increase, especially in rural areas, which are expected to account for a majority of new users. Latin America and Southeast Asia are also experiencing rapid connectivity growth due to affordable smartphones and expanding 4G/5G networks. This connectivity boom drives user engagement across digital platforms, from social media to e-commerce, which in turn creates opportunities for online marketplaces, digital wallets, and streaming services.

Investments in digital infrastructure

EM governments and private enterprises are heavily investing in digital infrastructure, most notably India’s “Digital India” initiative is accelerating rural connectivity. These improvements in foundational infrastructure will continue to support digital transactions and e-commerce expansion. Venture capital investments into regional tech startups are also strong, with the number of unicorn startups growing steadily in Southeast Asia and Latin America, highlighting investor confidence and presenting early-stage opportunities with high growth potential.

Sector-specific growth

Markets like Brazil, India, and Indonesia are experiencing double-digit growth in ecommerce in m. Bain & Company projects Southeast Asia’s internet economy to surpass $300 billion by 2025. While online retail will continue to lead, sectors like digital financial services, ed-tech, and health tech show impressive growth. Digital banking and microfinancing solutions are particularly in demand due to limited traditional banking infrastructure. This continues to create a compelling case for diversified exposure to the entire EM tech ecosystem.

India will emerge as the leading digital economy in the developing world

With over 800 million internet users, India already ranks as one of the largest online populations globally, and ongoing expansion of affordable 4G and 5G networks will only deepen digital access, especially in rural regions. Government initiatives, like “Digital India” and the Unified Payments Interface (UPI), have created a robust digital infrastructure and helped to accelerate the adoption of e-commerce, digital payments, and online services at an unprecedented rate.
At the same time, India’s middle class is expected to reach nearly 400 million people by 2025, with increased disposable income and a preference for online shopping, digital payments, and convenience services. Platforms like Reliance Jio and Flipkart, along with foreign giants such as Amazon and Walmart, are competing to capture these new consumers, further fueling growth.

Quick commerce will redefine the consumer experience across emerging markets

By 2025, “quick commerce” (q-commerce) — the delivery of goods in under an hour — will be a major force reshaping retail in EM. Emerging markets are uniquely positioned to embrace q-commerce due to densely populated cities where demand is high for quick access to essentials such as groceries, meals, and pharmaceuticals.
The shift toward q-commerce also reflects the unique payment preferences in these regions. Many providers are adapting to cash-on-delivery and digital wallet payments, making q-commerce accessible even to the unbanked population. In 2025, q-commerce will likely expand beyond urban centers, facilitated by investments in digital payments and infrastructure, and become an integral part of everyday life in emerging markets — transforming consumer expectations around speed and accessibility in retail.

Partner Outlook 2025

“The internet and e-commerce landscape in emerging markets is primed for significant growth by 2025, supported by expanding connectivity, innovative digital platforms, and infrastructure investment.”

While regulatory challenges exist, investors who prioritize regionally adaptive, tech-forward companies and platforms are well-positioned to benefit from the substantial growth potential in these dynamic markets.

For professional investors only. When you invest in ETFs your capital is at risk.

EMQQ Emerging Markets Internet UCITS ETF (EMQQ) seeks to provide exposure to the growth of online consumption in the developing world as middle classes expand and affordable smartphones provide unprecedentedly large swaths of the population with access to the internet for the first time.

INQQ India Internet UCITS ETF (INQQ) provides investors with exposure to India internet and ecommerce. India has become one of the fastest growing major economies. Central to this has been middle class growth, allowing swathes of the population to gain internet access and boosting online consumption.

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Emerging Markets 2025: The Rise of Digital and E-Commerce Giants

Growing Internet Penetration

Investments in digital infrastructure

Sector-specific growth

India will emerge as the leading digital economy in the developing world

Quick commerce will redefine the consumer experience across emerging markets

﻿ “The internet and e-commerce landscape in emerging markets is primed for significant growth by 2025, supported by expanding connectivity, innovative digital platforms, and infrastructure investment.”

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“The internet and e-commerce landscape in emerging markets is primed for significant growth by 2025, supported by expanding connectivity, innovative digital platforms, and infrastructure investment.”