Mercado Pago defies Brazil debt warnings with credit card expansion

Vice President Ignacio Estivariz maintains that the firm's underwriting models remain robust, shielding it from the risks currently rattling the broader financial sector. Despite rising delinquency rates—with loans more than 90 days past due reaching 18.7%—Estivariz asserts that the portfolio is healthy. The company relies on proprietary artificial intelligence and deep integration with MercadoLibre’s e-commerce platform to vet applicants, providing what he describes as a granular view of borrower behavior.

This confidence persists even as the Brazilian central bank prepares to introduce new measures aimed at curbing high-cost consumer credit. Although MercadoLibre’s second-quarter net profit dipped due to an 85% surge in provisions for doubtful accounts, the fintech arm shows no immediate intent to decelerate. Estivariz confirms the company is in regular dialogue with regulators and stands prepared to adjust its growth pace should the economic climate dictate a shift in strategy.