When Latin American cities began locking down in March 2020, it seemed like an existential crisis for MercadoLibre Inc., the region’s dominant e-commerce platform. Sales slowed to a trickle—for about a week. Then they bounced back, and soon they were above where they’d been a year earlier.
MercadoLibre’s e-commerce revenue grew 90% in 2020 as Covid accelerated the shift toward online shopping, according to Bloomberg Intelligence. The number of buyers on its marketplace grew 40%, to 65 million, in the 12 months ended on March 31. “We moved forward three to five years, depending on the country,” says Marcos Galperin, the company’s co-founder and chief executive officer. “There’s no going back.”
If MercadoLibre is changing the way Latin Americans shop, investors seem even more excited about how it’s changing the way they pay. Payment volume at MercadoPago, the company’s financial tech arm, increased 75% last year, to $50 billion, as merchants incorporated the ability to pay through smartphone apps or QR codes. The company also more than doubled the portfolio of its lending business. In 2018, Goldman Sachs Group Inc. estimated that 40% of MercadoLibre’s value came from its financial-services arm; today it’s 60%.
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