Software Outsourcing in Chile: The Complete Guide for 2025

Why are so many U.S. companies turning to Latin America for nearshoring opportunities? If you’ve wondered about this, we’re here to explain. Rapid technological advancements have turned LATAM countries into gateways to highly skilled tech talent. Here’s why they’re so appealing:

• Proximity and similar time zones;
• An abundance of top talent with the expertise you need;
• Affordable pricing without sacrificing quality.

Of these countries, Chile has emerged as a top outsourcing destination. Here’s why outsourcing software development to Chile is an excellent choice. Chile offers a unique combination of attributes that make it an ideal location for partnering with tech talent. Its stable political and economic climate has given rise to a thriving tech scene. This stability, paired with a strong focus on innovation and reliability, makes Chile software development a smart move for businesses looking to build long-term relationships with skilled engineers.

In this article, we’ll cover:

• A detailed look at the Chilean IT market.
• Why you should hire software developers in Chile.
• The cost of hiring software engineers in Chile.

So, if Chile has piqued your interest, we encourage you to learn more about its many benefits. Let’s dive in!

Overview of the Chilean Software Development Market

Chile offers a great balance of infrastructure, talent, and culture, making it a popular destination for software development and outsourcing. In fact, Chile is one of the most developed countries in Latin America, and its business-friendly environment is attracting more and more IT outsourcing and software development companies. 

Here are a few reasons why outsourcing software development to Chile is an excellent choice for your IT projects.

Business-Friendly Environment

As you know, doing business in a country where conditions feel as unstable as quicksand is something best avoided. Fortunately, that’s not a concern when working with engineers from Chile. In 2020, Chile’s tech market hit $6.4 billion, and it’s on track to add another $4 billion by 2027, growing at 8.55%. 

On top of that, Chile ranks first in Latin America for ease of doing business and 59th globally, underscoring its stable business environment, favorable climate, and solid infrastructure. This makes it an ideal option for companies looking for a secure and supportive location to partner with skilled tech talent.

Talent Pool: Software Developers in Chile 

A steady business environment sounds nice but, what about talent? 

Chile produces over 60,000 developers per year and 5 of their universities are among the best of Latin America according to the QS World University Rankings. 

According to Coursera’s Global Skills Index Report 2022, Chile ranks in the top 10 among Latin American countries for Data Science. It excels in areas like Data Visualization. This ranking reflects proficiency in cutting-edge tools and solutions such as:

• Python;
• SQL;
• RCloud; 
• APIs;
• Natural Language Processing (NLP).

Outsourcing software development to Chile means tapping into talent equipped to handle complex tech challenges with expertise and innovation. That’s not all, the country also stands out in various technological disciplines, including: 

• JavaScript;
• Web Development;
• UX design;
• Cybersecurity;
• IoT;
• AI;
• Cloud Computing. 

These skills highlight the quality of talent nurtured by its universities and thriving tech ecosystem. American companies looking to work with software developers in Chile will be impressed by the innovation and expertise these professionals bring to the table.

Source: Coursera’s Skills Report 2022

Tech Hubs

When it comes to the Chile software development ecosystem, the country stands tall. Let me give you a sneak peek of how it looks like:

Sources: Finnovista Finetech Radar Chile 2023, Global Startups Ecosystem Index and Statista. 

• Chile has 300 startups.
• An annual growth of 29.5% in finetech companies since 2019. 
• Ranks 3rd in South America according to the Global Startups Ecosystem Index. 
• 3 new unicorns: Betterfly, Cornershop, and NotCo.

Chile has several cities that are making significant strides, earning the nickname “Chilecon Valley” for good reason. Here are some of the bigger players: 

• The capital city Santiago is the largest technology hub. It is home to around 143 tech companies that go from startups to international firms. It also has several  tech parks and innovation hubs, such as Santiago Innovation Center. 
• Valparaiso, on the coast, is an emerging hub with the presence of top-knotch companies like OpenBionics, Valve, and Uber and is a key participant in the Startup Chile program. 
• Concepción is in the spotlight too, with companies whose main focus is on e-commerce, digital marketing, and cybersecurity. 

Last but not least we have Antofagasta. A thriving tech hub known for its vibrant community of loT developers. It is part multiple initiatives that promote tech innovation such as the Antofagasta Industrial Association

Government Support

In terms of government support, there have been many programs and initiatives that helped power up the Chilean technological environment. Many of which include:

• A Modification to Chilean Law: To boost foreign investment and support start-ups, allowing foreign investors to acquire visas in just two weeks. 
• Start-Up Chile: A seed accelerator founded in 2010 that aims to increase both local and international ventures in Chile. By 2024, it has supported over 1,600 startups and involved more than 4,500 entrepreneurs from 85 countries.
• A Free Trade Agreement: Facilitating international cooperation and free trade between 65 countries including 28 member-states of the EU, the United States, Japan, China, and the Pacific Alliance. 
• 5G Connection: Chile is leading the way in Latin America when it comes to 5G. Since 2022, its 5G network has grown 88.5%, according to the Undersecretary of Telecommunication. 

These advancements make the country an attractive choice for companies looking to hire software engineers in Chile. So know that if you consider outsourcing software development to Chile you’ll benefit from its dynamic environment and strategic global connections.

Time Zone and Cultural Allignment

Chile is only one hour behind Pacific Standard Time, making it an ideal location for outsourcing projects that require regular communication.

This alignment allows software developers in Chile to work simultaneously with U.S. companies, ensuring seamless communication and minimal delays. Companies opting for Chile software development benefit from real-time collaboration, quicker response times, and faster issue resolution.

Time zone differences: Major U.S. Cities vs. Chilean Tech Hubs

This LATAM location is not only compatible in terms of timing, it is also culturally aligned. As Americans, Chilean engineers share similar expectations for quality standards and strict adherence to deadlines. Their widespread use of agile methodologies ensures streamlined project management and adaptability, making collaboration smooth and effective. 

English Proficiency

Similarities don’t stop there, software developers in Chile are also bilingual. Ranking 47th in the EF English Proficiency Index and 8th in Latin America, Chilean engineers communicate effortlessly in English, reducing language barriers and promoting clear collaboration. These talented professionals bring not just technical skills but also a proactive mindset, making them invaluable for building strong partnerships.

All in all, Chile has a large pool of talented young Ticas (that’s what Chileans call women) and chicos (men) who are eager to work. The country has a high literacy rate, and many students graduate with degrees in computer science and related fields. However, some may not have the opportunity to work in their field of study, so you’ll find highly qualified developers who are hungry for challenging work.

Cost of Hiring Remote Developers from Chile

We’ve covered all the incredible qualities Chileans have to offer, so let’s switch gears and talk business. How much does it actually cost to hire software engineers in Chile? Salaries can vary based on the technology and seniority level, but on average, yearly salaries range between $84,000 and $115,200.

Let’s dive into the breakdown of average monthly costs by technology and explore what makes this an excellent investment for your team.

Chile offers competitive rates without sacrificing quality. Like its neighbors Brazil and Argentina, the LATAM region is renowned for providing top-tier developers at significantly more affordable prices than hiring in-house talent in the U.S. or Europe. This balance of quality and cost-effectiveness makes outsourcing to Chile a smart choice for businesses looking to scale efficiently.For more insights into nearshore software developers salaries check this article.

Disadvantages of Outsourcing Software Development to Chile

Although Chile is a country worth taking into account when expanding your team, it’s important to look at both sides of the coin. Understanding the pros and cons will help you make an informed decision and ensure successful outsourcing.

Developing Talent Pool

Chilean software engineers are undoubtedly skilled, but their strength lies in quality over quantity. Compared to larger countries like Brazil or Mexico, Chile produces fewer developers. However, the government is actively addressing this through initiatives like Talento Digital and Fundación Kodea. These programs aim to train the next generation of developers by offering a wide range of courses, helping to boost the country’s tech talent and meet growing industry demands. 

Taxation Specifics

Navigating Chile’s tax system for non-residents can be tricky. For example, dividends paid to non-resident shareholders are subject to a 35% withholding tax. The good news is that shareholders from countries with a double tax treaty with Chile can claim a full credit for corporate income tax.

However, if a Chilean company under the PIS pays dividends to someone in a country without a tax treaty, only 65% of corporate taxes can be credited. While this means the tax burden can be higher, it’s still manageable compared to other markets. To ensure a smooth experience when you hire software engineers in Chile, it’s wise to consult local legal experts. Alternatively, outsourcing through specialized companies can simplify things, as many take care of the legal paperwork for you, keeping it out of your plate.

The Solution for Outsourcing Software Development to Chile Without the Hassle

As you can see, Chilean engineers offer a winning combination of strong technical skills and excellent soft skills, creating a positive and productive work environment. However, trying to hire top-tier engineers in Chile without a clear recruitment plan can be overwhelming. Before you start hiring Chilean engineers, you should understand the many moving parts involved. 

That’s where local IT staffing agencies like BEON.tech come in.

When you work with a seasoned IT outsourcing company like us, with decades of experience in Latin America, you can take advantage of:

• Top 1% of tech talent: We introduce you to engineers who not only have the right skills but also match your unique needs.
• Hassle-free paperwork: As locals, we handle all the bureaucracy so you can focus on growing your operation and reaching your goals.
• Smoother onboarding: Our Talent Experience Management Framework ensures a seamless onboarding process, providing engineers with the tools and support they need for success.
• Ongoing engineering support: With a 9% turnover rate, we make sure your new hires stick around and remain committed to your project, worry-free.

If you’re ready to outsource software development to Chile and want a customized solution, we’re here to help. Book a free consulting call today, and let’s talk about how we can help you build a high-performing team with the best talent Chile has to offer.

FAQs

Why is Chile important to the U.S.?

Chile is a key partner for the U.S. in tech and software development. With a booming startup scene and solid STEM education, it’s become a hotspot for tech talent and innovation in Latin America. The U.S. has partnered with Chile on projects like the Digital Government Partnership and helped boost its internet infrastructure, making Chile a strong ally in driving digital progress and tech growth in the region.

What are the alternatives to Chile for IT outsourcing?

Other options for outsourcing software development to Chile are Argentina, Brazil, Mexico and Uruguay. These countries offer dynamic tech ecosystems, competitive costs, and supportive business environments. With strong innovation hubs and developers skilled in a variety of technologies, they provide everything you need for successful collaboration.

How Fast is the Software Development Industry Growing in Chile? 

Chile’s software development industry is growing at an impressive 8,55% annually, driven by strong government support, a skilled workforce, and increasing demand for outsourcing and nearshoring.

How to hire software engineers in Chile with BEON.tech?

Through our platform you can connect with a curated network of pre-vetted software engineers from Chile, empowering your development team to achieve more. Gain access to the top 1% of talent, an efficient interview process that assesses both technical and soft skills, and professionals with expertise in a wide range of technologies.