A large percentage of the population in Latin America doesn't have a checking account or credit card. This presented e-commerce provider MercadoLibre (NASDAQ:MELI) with a significant challenge. How could it get people to pay for digital transactions? By thinking outside the box, the company was able to turn a hurdle into a massive opportunity.

On this episode of Fool Live from Nov. 4, "The Wrap" host Jason Hall and Fool.com contributors Danny Vena and Asit Sharma discuss how MercadoLibre addressed the payments conundrum.

Danny Vena: I do think it's important to point out that MercadoLibre is coming from a different place in Latin America than where we are in the United States. In the United States, digital payments is something that has been around for a long time. It's well adopted. People have been using credit cards and bank accounts here regularly for decades.

In Latin America that's not the case. If I'm remembering the numbers correctly, only about half of the people in Latin America have a bank account and only about 30% have a credit or debit card. What MercadoLibre did in order to facilitate its e-commerce business, was to go out and it made agreements with a number of stores that are similar to 7-Eleven's here in the United States, these convenience stores. They are hooked up into MercadoLibre's system.

A customer can walk in and they can access their account and add money to it. They can make payments for goods there at their accounts. They can get a QR code scanned. This is something that really helped boost that digital payments business. Now they are, at least by my estimation, they are the undisputed leader in digital payments in Latin America. I think they make more money off every dollar from payments than they do off their commerce sales because I think their margins are much higher there.

Jason Hall: Here's my guess. Go look at Visa (NYSE:V) and MasterCard (NYSE:MA) gross margins. That's probably going to ballpark you, where they are. I think it's an enormous opportunity.

Asit Sharma: Or PayPal's (NASDAQ:PYPL). Visa's and MasterCard's margins are going to be even higher like through the roof higher like 90% high, but you're right. I think closer between the PayPal and a Visa or MasterCard, it's going to land there. It's such an exciting company.

Jason Hall: It is.

Asit Sharma: But thanks for all that insight.