Business

Mercado Libre will invest BRL 10 billion in Brazil in 2021

The amount equals the sum of the investments made by the company in the last four years in the country

Mercado Libre PIX
Photo: Casimiro PT/Shutterstock

Mercado Libre, the Latin American e-commerce giant, announced on Monday 1st that it will invest BRL 10 billion in Brazil in 2021 to expand its presence in the main market, considering that Latin America is the region in which e-commerce has grown the most in the world.

The billionaire investment was announced during the disclosure of the company’s results in the 2020’s Q4: sales almost doubled in the last three months of the year, showing the strength of e-commerce in Latin America. As a result, net revenue reached $ 1.3 billion, representing an annual increase of 96.9%. The gross merchandise volume (GMV) in the quarter reached $ 6.6 billion.

During Mercado Libre’s webcast, Pedro Arnt, CFO at Mercado Libre, stated that Latin America is the world’s fastest growing region for e-commerce, citing eMarketer data. MeLi had 37 million unique buyers during the last quarter.

Mexico surpasses Argentina and it is now second biggest market for MeLi in e-commerce

In terms of e-commerce regarding units sold and sales volume, Mexico is now the second biggest market for Mercado Libre, ahead of Argentina, said Arnt.

Image: Mercado Libre/IR webcast

The Brazilian market accounts for 54% of the company’s revenues and registered an increase of 68%.

Mercado Libre’s financial arm, Mercado Pago, processed $ 15.9 billion in payments in the fourth quarter, an annual increase of 83.9%. The segment’s loan portfolio reached $ 479 million. Osvaldo Gimenez, CEO at Mercado Pago, said that the financial arm is ready to offer a credit card in Brazil “and we plan to scale that during this year,” he told investors.

Also, Gimenez highlighted that in Brazil, Mercado Pago was one of the first players to launch PIX. “So far, we have seen significant shift in transfers to PIX. It is good that it is happening, it is easier for us [due to shipping, because it works] during the weekend.”

READ ALSO: Mercado Libre raises BRL 1.07 billion in Brazil with receivables fund for working capital

Mercado Envios, the group’s logistics service, also achieved good results. In Brazil, it had a penetration of 79% of the total deliveries in the 2020’s Q4 (in the same period of the previous year, the penetration was of 68%).

Translated by LABS.

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