After gaining success in ride-hailing, Grab co-founder Anthony Tan is pushing his start-up into a new challenge: catering to those underserved by traditional financial institutions in southeast Asia.
Tan made the announcement at Money 20/20 Asia, which kicked off today in Singapore.
Grab, which started as a taxi-hailing app firm and competes with Uber, has been expanding into financial services over the last two years, partly by acquiring companies.
It will be part of newly launched Grab Financial, which offers services ranging from payments to rewards and loyalty services, the firms said in a statement on Tuesday.
Thompson (pic, above) said, "At Grab, driver welfare is at the heart of our vision of improving the lives of people in Southeast Asia". Whether that's nano-loans for working capital, the ability to buy a auto, actually without financial services we're going to restrict the business growth of that whole ecosystem.
The company said it has facilitated over US$737 million in loans over that period for drivers and agents, with a default rate of less than 1.5 per cent.
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Eventually, the joint venture will offer credit scoring services to financial institutes and partner with banks to provide other financial products.
Grab is betting that its data on transport movements, geolocation, GrabPay transactions and consumer behavior will help in building benchmarks to assess customers' creditworthiness.
Grab has partnered with Credit Saison, a Japan-based lending firm that is likely the country's biggest lender, with a worth of $3 billion and around 70 million credit cards in circulation. We are excited to have a partner such as Chubb with whom we share this vision. Already, he added, Grab has a loan book in excess of $700 million thanks to campaigns to provide vehicle financing, insurance and more. It is also backed by some of the most powerful investors in the region, like SoftBank, China's Didi Chuxing, and Indonesia's Lippo Group, and can bring their vast resources to bear in its push into financial services.
Analysts expected a boom in digital financial services in Southeast Asia, especially Indonesia, where the majority of its 250 million population do not have bank accounts. "We've built the largest internet platform in Southeast Asia and this is another extension of that story".
Chubb Asia Pacific regional president Paul McNamee said, "We are delighted to work with a digital pioneer like Grab to protect their 2.6 million driver-partners".