Grab, the ride sharing platform we are all familiar with, has become a little more unfamiliar to us with the launch of its new product.
The news follows the announcement of GrabCycle, the first pilot project under GrabVentures.
Speaking at the Money 20/20 conference at Marina Bay Sands on Tuesday (Mar 13), CEO Anthony Tan announced the launch of Grab Financial, which will encompass Grab's payment system, rewards programme, agent network and financial services. Whether that's nano-loans for working capital, the ability to buy a vehicle, actually without financial services we're going to restrict the business growth of that whole ecosystem. Grab is present across eight countries in Southeast Asia and has an existing loan book worth over $700 million because of prior campaigns for auto financing, insurance, and more such facilities.
Jason Thompson, managing director of GrabPay Southeast Asia said at the event that Grab's move into Grab Financial is "entirely logical".
"The new joint venture, Grab Financial Services Asia, puts in place a much-needed infrastructure that will accelerate financial inclusion in Southeast Asia", Thompson said.
By analyzing behavior and transaction data from the app such as transport movement, geo-location and GrabPay transaction data, the firm said it can offer alternative data points to asset credit worthiness, filling the gap left by traditional credit scoring methods. Grab will offer loans to the underserved via a joint-venture with Credit Saison, the largest lender in Japan (the company now has about $70 million credit cards in circulation, TechCrunch reported today). US-based insurer Chubb is also signed on as a partner.
A Google and Temasek joint study in late 2017 forecast that Southeast Asia's internet economy would likely grow to be worth more than $200 billion by 2025, from an estimated $50 billion in 2017.
Grab, which started as a taxi-hailing app firm and competes with Uber, has been expanding into financial services over the last two years by acquiring companies and forming partnerships to push for the usage of its mobile wallet.
"We've not announced anything about Credit Saison investing in Grab", he added.
It previously also led an investment into Shopback, the leading cashback site in Southeast Asia.
Even though Southeast Asia is one of the fastest growing regions for smartphone adoption, only 27 percent of adults have a bank account, according to the World Bank.
And they may be the bigger victor behind the scenes.