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Grab expands portfolio of financial products

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A woman stands outside the Grab transport office in Singapore. AFP

Grab expands portfolio of financial products

Grab Financial Group, the financial technology arm of Southeast Asia-based ride-hailing app Grab, on Tuesday rolled out a series of consumer financial services, including microinvestment and microloan schemes.

The company’s new strategy, Thrive With Grab, includes microinvestments, third-party consumer loans, microinsurance and a pay-later programme, expanding its formerly merchants- and small businesses-focused fintech services to consumer financial services.

Grab Financial Group senior managing director Reuben Lai said: “By offering innovative microtransaction-based financial services, convenient financial management tools and access to products from leading global financial institutions, we hope to unlock the tremendous potential in financial services in the region in ways that serve all Southeast Asians.

“We aim to set a new benchmark for financial services in accessibility, convenience and transparency.”

Grab Financial will offer new products include AutoInvest – a platform that allows consumers to invest small sums of money – consumer loans and a buy-now-pay-later programme.

The fintech firm sees huge potential in Southeast Asia, where 70 per cent of the population is underbanked, according to a Bain, Temasek and Google e-Conomy report last year.

The report estimated that the revenue from the digital financial services is expected to reach $60 billion by 2025 and $75 billion in digital investment assets under management.

Another research report by Boston Consulting Group in May said more than one-third of Southeast Asian consumers are willing to shift some banking activities such as loans to nonbanking digital platforms.

The managing director said that even though the new services are not a direct response to Covid-19, the global pandemic has accelerated the transition to digital platforms.

Lai told reporters: “Even before Covid-19, it was relevant to Southeast Asia. The pandemic has accelerated the trend for several quarters, if not years.”

The announcement on Tuesday came as Grab raised up to $4.9 billion in February to spur its payment and financial services businesses. The company also secured $200 billion from Korean private equity firm Stic Investment Inc, Bloomberg reported on Monday.

Founded in 2012 in Malaysia as a taxi-hailing app, Grab has attracted several Korean investors, including Hyundai Motor, Kia Motors, SK Holdings, KL Investment, Naver and Mirae Asset Financial Group.

The company, valued at $14.3 billion according to CB Insights, has so far raised more than $10 billion.

THE KOREA HERALD/ASIA NEWS NETWORK

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