(Bloomberg) -- Latin American e-commerce giant MercadoLibre Inc. will keep expanding in the credit space as its fintech arm now accounts for almost half of the firm’s total revenue, according to Chief Financial Officer Pedro Arnt.
The company’s credit book has been “very profitable” so far and it makes sense to keep investing, Arnt said in an interview with Bloomberg TV. Loan growth “has been a significant driver and catalyst of more adoption of our wallet,” while helping merchants and giving them greater access to working-capital, Arnt said.
Read more: MercadoLibre Jumps After Results Show ‘Profitable Growth’
MercadoLibre saw its credit portfolio rise to almost $2.7 billion in the second quarter, up from about $2.4 billion at the end of March, and flagged that it has “adequately priced” the risk of a deterioration of credit quality across the region amid a tougher macroeconomic backdrop.
The Buenos Aires-based company posted record revenue and better-than-expected margins for the three-month period ended in June, with operations in Mexico turning a profit. A lot of investments MercadoLibre made throughout the pandemic in logistics and category expansion “to a certain degree are beginning to pay off,” Arnt said.
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