Narayan AmmachchiArgentinean e-commerce and payments giant Mercado Libre is pouring a record US$2.5 billion for the next step of its Mexican expansion.
The money (a 56% increased compared to the US1.6 billion invested in 2023) will be directed to more warehouse space and to improve the company’s payments infrastructure in the country, David Geisen, Mercado Libre’s Country Chief for Mexico, told Bloomberg.
This investment underscores Mexico’s growing importance for Mercado Libre. The Mexican market contributed over 20% of Mercado Libre’s 2023 revenue, a substantial increase from 2019’s 12%..
Mercado Libre is set to add 10 new logistics centers by year’s end, taking the total to 100. Mercado Pago, Mercado Libre’s fintech arm, will offer direct loans to app users, merchants within the platform’s ecosystem and credit card holders.
The synergy between e-commerce and fintech benefitted Mercado Libre to a great extent. The company’s credit portfolio grew by 30% in 2023, with its credit card being its fastest-growing product. This integration allows the retailer to offer a comprehensive suite of services, attracting both consumers and merchants.
Often referred to as the “Latin American eBay,” Mercado Libre has seen tremendous growth over its 25-year history. The retailer boasts a market value of nearly US$80 billion and is the region’s second-most valuable company, according to Bloomberg.
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