MercadoLibre is an eCommerce company with headquarter in Buenos Aires, Argentina, dubbed the “eBay of Latin America”, because of its dominant position in the Latin America’s market.
While Mercado Pago is its payment platform that enable the customers to send and receive money via emails, and other solutions to facilitate transactions with online merchants that support the payment system. It also enable the online retailers to provide their customers with installment payment solutions.
In a dramatic move, PayPal has entered into partnership with the Latin America eCommerce giant, with their payment platforms getting direct integration, to allow customers of the eCommerce to use PayPal for online checkout, and other merchants that integrate with Mercado Pago.
The integration means that PayPal’s over 300 million existing users will be able to shop and make payments at “hundreds of thousands of new merchants” in Latin America, with PayPal also as a payment option at checkout on the MercadoLibre platform.
Additionally, PayPal will offer Mercado Pago as payment option for merchants accepting PayPal, which will expand PayPal’s reach to the over 48 million existing users on Mercado Pago. And PayPal is also expanding Xoom service, which is its online money transfer solution, to support remittances paid to Mercado Pago wallets in Mexico and Brazil.
However, it should be noted that PayPal had earlier invested $750 million in purchase of common stock from MercadoLibre, which investment would accelerate the growth to “foster financial inclusion in Latin America.”
PayPal’s integration with MercadoLibre followed the strategic investment in the eCommerce conglomerate, which scale and capabilities will help drive access and inclusion to the global digital economy.