Mercadolibre close to finalizing Whatsapp Pay in Brazil

Adeniyi Odukoya
WhatsApp Pay

Mercadolibre, a Brazilian e-commerce retailer and fintech, has begun negotiations with Meta to process payments for its WhatsApp service (WhatsApp Pay) in Brazil.

WhatsApp announced the launch of WhatsApp Pay; an in-app feature that will allow users to message and pay business owners in chats. Officials believe that this marks an opportunity for them to leverage WhatsApp in an efficient manner and generate increased sales, alongside improved customer contacts. 

Pedro Arnt—the company’s chief financial officer—while reacting to Mark Zuckerberg’s statements about enabling WhatsApp users to message and purchase from a business directly via the chart, affirmed that they were in a “test phase” as one of the collaborators seeking to finalize WhatsApp payments in Brazil. 

The move came on the 5th of May following the approval of Brazil’s Central Bank (BC) on March 30th. The long-awaited approval comes after a one-year suspension of the feature by the Central Bank which, in June 2020, ruled that WhatsApp’s peer-to-peer system could cause irreparable damage to Brazil’s existing payment system due to competition and data privacy concerns.

In August 2020, however, WhatsApp Pay was formally approved for testing by the Central Bank, following the implementation of PIX, the BC’s instant payment system launched in mid-November of last year. Following WhatsApp Pay’s full launch, Brazil is now only the second country to implement the feature and with over 120 million active WhatsApp users – around 60% of the Brazilian population – its potential for growth is striking.

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In addition, he said that the payment process would ensure transactions within the app (in-app transactions) and Whatsapp users situated in Brazil can simply locate the valid company account via a directory feature:

He said:

“This could be an opportunity for us to leverage Whatsapp efficiently to generate more sales and better customer contacts.”

Read Also: Hackers eye wealthy crypto funds using telegram chats 

More info about Mercadolibre and WhatsApp Pay

Pedro chose not to unveil so much information on the technical advancement stage of WhatsApp Pay. Nonetheless, the company is one of the numerous firms mentioned by Whatsapp as having the needed technical integration but still subjected to its “test phase.”

Though India, Brazil and Indonesia rank as Whatsapp’s largest markets, Pedro needed to specifically state revenue expectations for Mercado Pago, the company’s financial arm. In November, some weeks back, the company announced that with its 88 million distinctive active users across 18 countries, it acquired a much better than projected profit for the third quarter on record net revenue of $2.7 billion. He went ahead to explain in a statement, justifying its third-quarter earnings, saying:

“We have a very strong relationship with our consumers because we can solve their financial needs and their commerce needs. That puts us in a very strong position.”

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Due to the present crypto bearish pull and the FTX’s recent bankruptcy, the CFO said that all Mercado pago users in some countries will still be able to purchase, store and sell crypto within digital wallets.

He said:

“The market timing was wrong but it has a lot to do with learning about crypto storage, purchasing and selling. No more purchases and we are not selling either, we are still holders of those assets.”

In addition, he said that the firm’s $30 million investment holding for 2021 is now worth $11 million. 

>Read: African Bitcoin miner, Gridless raises $2m seed in round led by Jack Dorsey’s Block

 The Future plans of Mercadolibre 

The CFO divulged that the firm presently relies on Mercado Envios to increase its regional logistics interface and now has a fleet of more than 1000 electric vehicles. 

They also have ongoing discussions with startups such as U.S-based Xos Trucks in a bid to create design specifications for vehicles which he said might likely occur in the next year.

He also revealed that the company’s commitment to continuous investment in technology so that retail advertisers can get more insight into consumer behaviour. 

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