As merchants bring their businesses online, they need to accept consumer payments, extend loans to potential purchasers, and even provide insurance. As a result, in many emerging markets regions such as Latin America and Southeast Asia, the development of the fintech scene has occurred in tandem with the rise of e-commerce platforms.
But when does it make sense for these fintech payments plays to break apart from their ecommerce counterparts?
Investors in LatAm ecommerce giant, MercadoLibre, are asking just that.
MercadoLibre’s payments businesses, MercadoPago, is driving a tremendous amount of growth with payments transactions up 72% year over year, to a total payment volume (TPV) of $5.3bn. And off-line payments are now overtaking the on-platform business, as e-commerce sites and brick-and-mortar retailers adopt MercadoPago as the preferred payment method.
The path for the payments darling to split from the e-commerce anchor was paved long ago when investors and analysts initiated PayPal’s split from Ebay in 2015. While hitched to Ebay, PayPal fell behind in smartphone-based payments. But following the split, PayPal flourished, adding nearly $65b of enterprise value to the standalone company.
While a break up is never easy, sometimes it’s just the right thing for everyone….
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Is MercadoLibre the new PayPal? Analysts wonder as payments jump - MercadoLibre, the leading ecommerce provider in Brazil, is quickly evolving as a payments and fintech company. Their payments product MercadoPago is following in the footsteps of PayPal and Alipay - with more payments now "off platform" than on MercadoLibre itself. Read more
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Wearable payments are finally starting to take off in the U.S. - Target, Costco, and other brands are increasingly embracing contactless payment methods, opening the opportunity for wearables to become payment mediums. Read more
Bitcoin retail investor holdings continue incremental growth - Diar Research shows that while a majority of circulating supply that sit in public addresses that hold between 10 and 1000BTC have been net sellers over the past year, addresses holding between 1 and 10 Bitcoins continue to grow steadily. Read more
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Better Mortgage - New York based digital mortgage lender has raised a $75m Series C from American Express Ventures, Kleiner Perkins, Goldman Sachs and others. Read more
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FinTech Collective Newsletter
“If you're in fintech and you don't get the @fintech_io newsletter, you're not really in fintech. Pure Gold.” — Jase Wilson, CEO, Neighborly (@jase)
Delivered every Saturday, the weekly newsletter, produced by our team, provides a tightly edited rundown of global fintech news, along with a bit of our original analysis.