Ride hailing platform Grab (Cambodia) Co., Ltd has carefully navigated the dual currency system in the Kingdom by adopting the riel to drive its business, despite the US dollar dominating the local economy.
Its parent company, Singapore-headquartered Grab Taxi Holdings, that offers mobile technology to promote efficient city transportation, has a cardinal corporate policy – “to be hyper local”.
Grab adopts the national legal tender to make it convenient and safe for users to hire its services and this is evidenced in the way it has embraced local currencies in all eight countries where it operates.
Reflecting the native country’s identity, Grab uses the Singapore dollar in the island state, the ringgit in Malaysia, in Thailand it is the baht, pesos in the Philippines, dong in Vietnam, kyat in Myanmar and in Indonesia it is the rupiah – a potpourri of currencies.
Although the US dollar remains a more popular currency in Cambodia, all Grab’s transactions are officially conducted with the local currency. The system charges customers in riel and drivers’ commissions are also paid using the local currency.
“From our perspective, I think the strength of Grab is that it is a regional [player] but a hyper local company and in every country we go, we want to transact in the local currency."
“We understand that the local currency (riel) may not be the dominant one in the city but in rural areas, especially, people tend to use the local currency,” Ron Wong, Country Head of Grab (Cambodia) Co., Ltd told The Post.
After launching its operations in Phnom Penh in late 2017, the company extended its services to Siem Reap, conflating digital technology with traditional mode of transport to bring tech-oriented transport solutions making travel convenient for all segments of the Cambodian public.
It introduced the JustGrab, GrabBike, GrabTukTuk and GrabRemorque – all functioning on digital platforms to serve the growing population in cities like Phnom Penh.
In addition, the company also launched Grab for Business last November, another of its innovative ideas that will help ease messy company transport expenses and claims.
Wong said Grab made a practical decision to pick the riel over the dollar after observing the market trends and took into consideration the company’s corporate policy – ultimately to cater for the needs of the local people.
“The key thing is we are a hyper local and we really want to assimilate and adapt our operations to serve the people of the country. We really want to go into the markets for the locals, hence we decided to adopt the local currency rather than the USD."
“We also saw the local currency gaining against the USD and the riel has been stabilising, hence we think that is the natural currency that we should be actually using,” added Wong.
He said the company’s transactions are divided into two categories – customers and drivers – and both parties are officially charged and paid in the local currency. Staff salaries are also paid in riel.
“We totally support the local currency. For passengers, it is important to have a single currency, rather than to transact in both USD or riel. Charging in riel helps to access a bigger market, definitely in rural areas, and that helps our business,” he said.
Wong also said that “Single currency is always more ideal because it is better and cheaper for businesses and customers. For businesses, when we have two currencies, we have to do two accounts and do the conversions.
“And for customers it is much cheaper because they won’t be hit by any exchange rates and there is transparency in charging. It makes the customer spend more and keeps the system efficient.”
