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Mercado Libre Surges Past 50 Million Fintech Users


In a resounding testament to its burgeoning influence in Latin America’s financial sector, Mercado Libre, often dubbed as the “Amazon of Latin America,” has achieved a remarkable milestone, surpassing 50 million unique fintech users. The Argentina-based e-commerce juggernaut, with substantial operations in Brazil and Mexico, disclosed this record-breaking feat in its recent report, signalling a momentous stride forward for the company as it competes with emerging neobanks like Nubank across the region.

Underpinning this milestone is the remarkable user growth witnessed by Mercado Libre’s neobank arm, Mercado Pago, over the past year. With numbers soaring by almost 10 million, including a substantial 4.3 million increase in the last quarter alone, the company’s user count stood at a formidable 53.3 million as of December. This surge in user base has translated into a significant leap forward in total payments processed, consolidating Mercado Libre’s position as a financial powerhouse in the region.

In a communiqué addressed to its shareholders, Mercado Libre attributed this milestone to “major market share gains” and robust margin expansions, underscoring the transformative impact of its sustained investments in technology. Emphasising its long-term strategic vision, the company asserted its commitment to positioning its ecosystem as a frontrunner in Latin America’s commerce and financial service markets.

Notably, Mercado Libre’s foray into fintech has yielded substantial revenue gains, with fintech revenue totaling a staggering $1.8 billion, reflecting a remarkable 73% year-over-year growth. While headquartered in Buenos Aires, the lion’s share of this revenue is generated in Brazil, the region’s largest market, with Mexico also emerging as a significant contributor to Mercado Pago’s revenue stream.

A pivotal component of Mercado Pago’s strategy has been its high-yield savings account product, designed to entice customers away from traditional banking institutions by offering competitive interest rates on deposits. With over 30 million accounts of this nature, Mercado Pago has demonstrated its ability to capture market share and diversify its revenue streams.

Moreover, Mercado Pago has adopted a proactive approach to credit offerings, despite the inherent complexities and risks associated with the product. Buoyed by a significant decrease in non-performing-loan ratios, the fintech has expanded its credit book by 33% year over year to $3.8 billion by the end of 2023, with credit cards and consumer loans emerging as primary growth drivers.

While Mercado Pago continues to broaden its revenue streams and expand its product portfolio, including the recent introduction of credit cards in Mexico and the expansion of its loan services, the company’s consolidated net income fell short of market expectations. Despite posting a $165 million profit, consistent with the year-ago quarter, shares experienced a slight dip in aftermarket trading, underscoring the challenges and opportunities inherent in Mercado Libre’s ambitious expansion into the fintech arena.

As Mercado Libre continues to assert its dominance in Latin America’s financial landscape, its relentless pursuit of innovation and strategic investments in technology are poised to reshape the region’s financial ecosystem, cementing its position as a formidable force to be reckoned with in the years to come.

Pan Finance is a print journal and news website providing worldwide intelligence on finance, economics and global commerce. Known for our in-depth analysis and opinion pieces from esteemed academics and celebrated professionals; our readership consists of senior decision makers from across the globe.

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