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How Mercado Libre built a Fintech empire
From solving checkout to rewriting financial services in Latin America
Jevgenijs Kazanins
June 15, 2025
Hey!
I went down the rabbit hole of researching commerce platforms with Fintech arms, and Mercado Libre might be the most impressive example out there. What started as the Amazon of Latin America has quietly morphed into one of the region’s leading Fintech companies, now aiming to build the largest digital bank in Latin America.
The company’s Fintech arm, Mercado Pago, was born out of necessity to facilitate payments on its marketplace. But from there, it grew naturally into a full-stack financial platform. Along the way, it built the Latin American equivalents of PayPal, Square, and Affirm, and now it’s putting the pieces together to become a full-service bank.
If there’s any company that can challenge Mercado Libre, it’s Nubank. Nubank had a head start in lending and already pulled ahead in users and revenue. But with Mercado Pago now scaling aggressively, the real battle will play out in Mexico. Wall Street thinks both companies can thrive, and I think it’s going to be a hell of a fight.
But who doesn’t like a rivalry between two amazing companies?
Let’s dive in!
Jevgenijs
p.s. if you have feedback, just reply to this email or ping me on X/Twitter
I’ve been planning to write about Mercado Libre $MELI ( ▲ 0.13% ) for a while, and I even had a draft back in 2022 that I never published. But now that the company is aiming to become the largest digital bank in Latin America, it’s impossible to ignore. You can expect me to write more often about Mercado Libre in the future, but today, let’s start with the basics.
“We are building the largest digital bank in Latin America. In a region that still faces challenges in accessing quality services, we want to change the way users interact with the financial system with a digital bank where everyone wins.”
Mercado Libre, often called the Amazon of LatAm, is Latin America's leading e-commerce and Fintech platform offering online marketplaces, digital payments, and logistics solutions. The company was founded in 1999 by Marcos Galperin while he was still a student at Stanford.
“Mercado Libre's e-commerce platform is present in 18 countries (Argentina, Brazil, Mexico, Chile, Colombia, Peru, Uruguay, Venezuela, Bolivia, Costa Rica, Dominican Republic, Ecuador, Guatemala, Honduras, Nicaragua, Panama, Paraguay and El Salvador).”
In 2024, Mercado Libre celebrated its 25th anniversary since founding, but Latin America still lags the U.S., the U.K., and China in e-commerce penetration (share of retail sales taking place online). Mercado Libre is not just benefiting from the rise of e-commerce, it’s also consistently expanding its share of the market.
Image source: EMARKETER
“Our e-commerce platform provides buyers and sellers with a robust and safe environment that fosters the development of a large e-commerce community in Latin America, a region with a population of over 650 million people where penetration of e-commerce over total retail significantly lags benchmarks such as the U.S., the U.K. and China.”
Thus, in 2024, over 100 million people shopped on Mercado Libre, up from 44 million in 2019. Like many e-commerce companies, Mercado Libre got a boost from the pandemic-driven shift to online shopping. But unlike most, it kept growing long after the world reopened.
It’s worth noting that the vast majority of sales on Mercado Libre happen between third-party buyers and sellers. The company itself handles less than 10% of gross merchandise volume as a direct retailer. Mercado Libre steps in as a direct seller in select categories where supply is limited or competition is weak.
Data source: Mercado Libre
“The Mercado Libre Marketplace is a user-friendly online commerce platform that can be accessed through our mobile app or website. Third-party sellers ("3P") account for most of the GMV transacted on the Marketplace. We complement this by selling directly to consumers on a first-party basis ("1P") in selected categories where we can enhance price competitiveness and assortment; this accounts for less than 10% of GMV.”
Succeeding in e-commerce required building a logistics business. Thus, in 2024, 94% of the items sold on the Mercado Libre marketplace were delivered through the company’s network of fulfillment centers. Per the company’s annual report, Mercado Libre now owns and leases 4.3 million square meters (46 million square feet) of facilities across Latin America.
Image source: Mercado Libre
There’s more to Mercado Libre’s e-commerce story, like its growing advertising business, but I won’t pretend to be an expert in that. What really caught my attention is the company’s Fintech arm, Mercado Pago. Mercado Pago serves both consumers and merchants, offering everything from digital accounts to POS terminals and lending.
Image source: Mercado Libre
“Aside from communicating the win-win value proposition of MercadoPago, we also want it to be even more closely tied to MercadoLibre at the center of our ecosystem. This is why MercadoPago has turned yellow and now shares the primary color of our ecosystem. We don't want to have a yellow side of the ecosystem and a blue side of the ecosystem. We want to have a single ecosystem.”
Mercado Pago is one of the largest Fintech companies in the region, serving 64 million monthly unique customers. It claims to be the largest Fintech player by monthly active users in Argentina, Mexico, and Chile, and the second largest in Brazil, just behind Nubank.
“…our fintech platform, Mercado Pago, is present in 8 countries (Argentina, Brazil, Mexico, Chile, Colombia, Peru, Uruguay and Ecuador).”
