- In Brazil, Mercado Pago was one of the first players to launch PIX;
- According to Mercado Pago, the card will be offered progressively to its customer base.
Mercado Pago, Mercado Libre’s financial arm, launched its credit card on Thursday. As reported by LABS, Osvaldo Gimenez, CEO at Mercado Pago, said during investors call, that the financial arm was ready to offer a credit card in Brazil, and it plans to scale that during this year.
Mercado Libre’s fintech processed $15.9 billion in payments in the fourth quarter, an annual increase of 83.9%. The segment’s loan portfolio reached $ 479 million.
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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.”
Mercado Pago’s new move shows how financial institutions with a digital focus in Brazil have advanced to try to keep customers and expand the recurrence in their marketplaces.
The fintech has also launched payment by NFC to its app. The launch of the card, in partnership with the Visa banner, comes in the wake of the strong expansion of the group’s customer base last year, with the COVID-19 pandemic accelerating the migration of transactions to the digital environment.
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According to Mercado Pago, the card will be offered progressively to its customer base. The fintech claims to have more than 20 million active users of the app.
“In the second half, the card will be offered to anyone interested,” said Tulio Oliveira, Mercado Pago’s VP. Those who already have the brand debit card do not need to request an exchange, simply activate the credit mode in the app.
The card is exempt from the annual fee as long as you spend at least BRL 50 per month, it allows you to split purchases up to 18 interest-free installments at some retailers and accumulates points in the brand loyalty program, but does not include cashback.
The Mercado Pago announcement illustrates how the largest digital financial services portals in Brazil, after having had a sharp growth in the last year, driven by the pandemic, now expand initiatives to try to retain the profitability of the customer base, who often have accounts simultaneous in several rivals in the market.
On Wednesday, the XP platform launched the credit card that allows 1% of the amount spent on it to return as a balance for investments.
The digital bank Nubank, which emerged as a credit card platform, announced in February a modality of the product focused on unbanked people. And the PicPay digital wallet also launched its credit card at the end of last year.
