| SECURITIZATION TRANSACTIONS The process of securitization consists of the issuance of securities collateralized by a pool of assets through a special purpose entity (“SPEs”), often under a VIE. The Company securitizes financial assets associated with its credit card receivables and loans receivable portfolio. The Company’s securitization transactions typically involve the legal transfer of financial assets to bankruptcy remote SPEs. The Company generally retains economic interests in the collateralized securitization transactions, which are retained in the form of subordinated interests. For accounting purposes, the Company is generally precluded from recording the transfers of assets in securitization transactions as sales and is required to consolidate the SPE. The Company securitizes certain credit card receivables related to users’ purchases through Brazilian SPEs. Under the SPE contracts, the Company has determined that it has the obligation to absorb losses or the right to receive benefits of the SPEs that could be significant because it retains subordinated interest in the SPEs. As the Company controls the vehicles, the assets, liabilities and related results are consolidated in its financial statements. Additionally, the Company securitizes certain loans receivable through Brazilian, Argentine, Mexican and Chilean SPEs, formed to securitize loans receivable provided by the Company to its users or purchased from financial institutions that grant loans to the Company’s users through Mercado Pago. According to the SPE contracts, the Company has determined that it has both the power to direct the activities of the entity that most significantly impact the entity’s performance and the obligation to absorb losses or the right to receive benefits of the entity that could be significant because it retains the equity certificates of participation and would therefore also be consolidated. When the Company controls the vehicle, it accounts for the securitization transactions as if they were secured financing and therefore the assets, liabilities and related results are consolidated in its financial statements. The secured debt is issued by the SPEs and includes collateralized securities used to fund the Company’s fintech business. The third-party investors in the securitization transactions have legal recourse only to the assets securing the debt and do not have recourse to the Company. Additionally, the cash flows generated by the SPEs are restricted to the payment of amounts due to third-party investors, but the Company retains the right to residual cash flows. The following table summarizes the Company’s collateralized debt under securitization transactions, as of June 30, 2026: | | | | | | | | | | | | | | | | | | | | | | | | | | | | SPEs | | Collateralized debt
(In millions) | | Interest rate | | Currency | | Maturity | | Mercado Crédito I Brasil Fundo de Investimento Em Direitos Creditórios Não Padronizados | | $ | 99 | | CDI + 2.25% | | Brazilian Reais | | March 2027 | | Mercado Crédito I Brasil Fundo de Investimento Em Direitos Creditórios Não Padronizados | | 19 | | CDI + 5.25% | | Brazilian Reais | | June 2029 | | Mercado Crédito Fundo de Investimento Em Direitos Creditórios Não Padronizado | | 177 | | CDI + 2.50% | | Brazilian Reais | | March 2029 | | Mercado Crédito II Brasil Fundo De Investimento Em Direitos Creditórios Nao Padronizados | | 233 | | CDI + 1.75% | | Brazilian Reais | | October 2031 | | Mercado Crédito II Brasil Fundo De Investimento Em Direitos Creditórios Nao Padronizados | | 61 | | CDI + 5.25% | | Brazilian Reais | | June 2028 | | Mercado Crédito Estruturado Fundo De Investimento Em Direitos Creditórios | | 11 | | CDI + 4.50% | | Brazilian Reais | | November 2027 | | Seller Fundo De Investimento Em Direitos Creditórios | | 29 | | CDI + 1.40% | | Brazilian Reais | | September 2026 | | Seller Fundo De Investimento Em Direitos Creditórios | | 20 | | CDI + 1.60% | | Brazilian Reais | | November 2026 | | Seller Fundo De Investimento Em Direitos Creditórios | | 295 | | CDI + 0.85% | | Brazilian Reais | | May 2028 | | Seller II Fundo De Investimento Em Direitos Creditórios Segmento Meios De Pagamento De Resp Ltda | | 194 | | CDI + 0.85% | | Brazilian Reais | | July 2027 | | Seller III Fundo De Investimento Em Direitos Creditórios Segmento Meios De Pagamento De Resp Ltda | | 305 | | CDI + 0.65% | | Brazilian Reais | | February 2029 | | Mercado Crédito XXXVIII | | 2 | | TAMAR rates plus 100 basis points with a min 15% and a max 50% | | Argentine Pesos | | May - August 2026 (1) |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | SPEs | | Collateralized debt
(In millions) | | Interest rate | | Currency | | Maturity | | Mercado Crédito XXXIX | | 13 | | TAMAR rates plus 100 basis points with a min 25% and a max 50% | | Argentine Pesos | | July - October 2026 (1) | | Mercado Crédito XL | | 10 | | TAMAR rates plus 100 basis points with a min 20% and a max 75% | | Argentine Pesos | | July - November 2026 (1) | | Mercado Crédito XLI | | 9 | | TAMAR rates plus 100 basis points with a min 20% and a max 75% | | Argentine Pesos | | August - December 2026 (1) | | Mercado Crédito XLII | | 23 | | TAMAR rates plus 100 basis points with a min 20% and a max 75% | | Argentine Pesos | | September - December 2026 (1) | | Mercado Crédito XLIII | | 59 | | TAMAR rates plus 100 basis points with a min 20% and a max 75% | | Argentine Pesos | | October - December 2026 (1) | | Mercado Crédito XLIV | | 59 | | TAMAR rates plus 100 basis points with a min 17% and a max 55% | | Argentine Pesos | | December 2026 - February 2027 (1) | | Mercado Crédito XLV | | 60 | | TAMAR rates plus 100 basis points with a min 17% and a max 55% | | Argentine Pesos | | January - May 2027 (1) | | Mercado Crédito XLVI | | 61 | | TAMAR rates plus 100 basis points with a min 17% and a max 50% | | Argentine Pesos | | February - May 2027 (1) | | Mercado Crédito XLVII | | 60 | | TAMAR rates plus 100 basis points with a min 17% and a max 50% | | Argentine Pesos | | March - August 2027 (1) | | Mercado Crédito XLVIII | | 66 | | TAMAR rates plus 100 basis points with a min 17% and a max 50% | | Argentine Pesos | | April - August 2027 (1) | | Mercado Crédito XLIX | | 71 | | TAMAR rates plus 100 basis points with a min 17% and a max 50% | | Argentine Pesos | | May - September 2027 (1) | | Mercado Crédito L | | 76 | | TAMAR rates plus 100 basis points with a min 17% and a max 45% | | Argentine Pesos | | June - October 2027 (1) | | Mercado Crédito LI | | 81 | | TAMAR rates plus 100 basis points with a min 15% and a max 45% | | Argentine Pesos | | June - September 2027 (1) | | Fideicomiso Irrevocable de Administración y Fuente de Pago F/6203 | | 296 | | The equilibrium interbank interest rate published by Banco de Mexico in the Diario Oficial plus 2.20% | | Mexican Pesos | | November 2029 | | Fideicomiso Irrevocable de Administración y Fuente de Pago 6189 | | 220 | | The equilibrium interbank interest rate published by Banco de Mexico in the Diario Oficial plus 2.55% | | Mexican Pesos | | April 2027 | | Fideicomiso Irrevocable de Administración y Fuente de Pago Número F/6279 | | 259 | | The equilibrium interbank interest rate published by Banco de Mexico in the Diario Oficial plus 2.50% | | Mexican Pesos | | August 2027 | | Fideicomiso Irrevocable de Administración y Fuente de Pago F/6191 | | 675 | | The equilibrium interbank interest rate published by Banco de Mexico in the Diario Oficial plus 2.20% | | Mexican Pesos | | June 2027 | | Frontal Trust Mercado Pago Créditos Fondo de Inversión | | 22 | | TAB 30 + 2.10% | | Chilean Pesos | | November 2029 | | Frontal Trust Mercado Pago Créditos Fondo de Inversión | | 4 | | TAB 30 + 3.90% | | Chilean Pesos | | November 2029 |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | SPEs | | Collateralized debt
(In millions) | | Interest rate | | Currency | | Maturity | | Frontal Trust Mercado Pago Créditos Fondo de Inversión | | 18 | | TAB 30 + 4.25% | | Chilean Pesos | | November 2029 | | | $ | 3,587 | | | | | | |
(1) Minimum and maximum maturity depending on the applicable interest rate within the range. During the first quarter of 2026, the Company achieved interest rate reductions across one SPE in Brazil: Mercado Crédito Fundo de Investimento Em Direitos Creditórios Não Padronizado reduced its interest rate spread from 3.00% to 2.50% (and extended its maturity from April 2028 to March 2029) and one SPE in Mexico: Fideicomiso Irrevocable de Administración y Fuente de Pago 6189 reduced its interest rate spread from 2.80% to 2.55%. The assets and liabilities of the SPEs through which the Company securitizes financial assets as of June 30, 2026 and December 31, 2025 are as follows: | | | | | | | | | | | | | June 30,
2026 | | December 31,
2025 | | Assets | (In millions) | | Current assets: | | | | | Cash and cash equivalents | $ | 76 | | | $ | — | | | Restricted cash and cash equivalents (1) | 373 | | | 422 | | | Loans receivable, net of allowances | 3,291 | | | 2,632 | | | Intercompany receivables | 2,079 | | | 1,419 | | | Total current assets | 5,819 | | | 4,473 | | | Non-current assets: | | | | | Long-term investments | — | | | 8 | | | Loans receivable, net of allowances | 282 | | | 218 | | | Total non-current assets | 282 | | | 226 | | | Total assets | $ | 6,101 | | | $ | 4,699 | | | Liabilities | | | | | Current liabilities: | | | | | Loans payable and other financial liabilities | $ | 2,356 | | | $ | 1,039 | | | Intercompany liabilities | 396 | | | 147 | | | Total current liabilities | 2,752 | | | 1,186 | | | Non-current liabilities: | | | | | Loans payable and other financial liabilities | 1,231 | | | 1,813 | | | Total non-current liabilities | 1,231 | | | 1,813 | | | Total liabilities | $ | 3,983 | | | $ | 2,999 | |
(1) Restricted cash and cash equivalents from the SPEs include balances maintained in digital wallets that are eliminated for consolidation purposes.
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