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South American e-commerce giant MercadoLibre and Brazilian financial services company Creditas have joined forces to enable MercadoLibre users to apply for used car loans in Mexico.
MercadoLibre’s head of autos in Mexico, Jaime Ugalde, told Reuters on Thursday (July 28th) that the two companies hoped to attract consumers to a country with minimal credit penetration.
Companies are recruiting batches of used cars to join the program, hoping to expand semi-new offerings across Mexico starting with Creditas, country manager Gabriela Rolon told Reuters.
“It’s also great for sellers,” she said, adding that potential buyers can start looking for car lots with the peace of mind that a specific amount for their down payment has been approved.
The Reuters report noted that demand for used cars in Mexico has grown alongside supply chain issues stemming from the pandemic and the Russian-Ukrainian conflict.
In the first six months of 2022, MercadoLibre said, the company’s market searches for vehicles under 25,000 miles and under five years old doubled.
“I think it can be a great option for someone who, for example, is looking for their first car and has no credit history, or someone who is looking for an older car because that’s what they want. ‘he can afford,” Ugalde said. .
See also: Western Union, MercadoLibre partner on remittances to Mexico
Earlier this month, MercadoLibre partnered with Western Union to enable digital remittances to be sent to Mexico.
This allows families living abroad to send money using Western Union, while Mexicans can collect payments through Mercado Pago, MercadoLibre’s digital financial operation.
Also this month, Creditas announced it was raising $200 million and buying a bank and mortgage startup in a bid to bolster its profitability.
Creditas CEO Sergio Furio said his company, which runs an online consumer lending platform, is buying Andbank’s Brazilian banking license and plans to start taking deposits.
“Getting retail deposits as a new funding alternative will improve our margins,” Furio said.
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