Singapore ride-hailing company Grab has secured $850 million in financing to expand its digital payments and financial services.
Grab will receive $850 million in investments to boost its digital payments and financial services amidst competition with Indonesian company GoJek. Over $700 million was raised by Japan's largest bank, Mitsubishi UFJ Financial Group (MBFJF), while the remaining came from Japanese IT solutions company TIS.
In a statement, Grab president Ming Maa said the firm will partner with Mitsubishi and TIS to co-develop financial products. Maa explained: "Ensuring greater access to affordable and accessible financial services and products is key to growing financial inclusion in Southeast Asia."
After pushing Uber out of the Southeast Asian region, Grab has stepped up the competition with regional rivals, including Jakarta-based GoJek, which launched its services at Grab's base of operations, Singapore, in 2018.
Both firms have expanded their services beyond ride-hailing and are attempting to establish themselves as "super apps" which offer users everything from food delivery to financial services.
In 2019, Grab launched its financial services including consumer insurance and loans to its users.
Reuben Lai, senior managing director of Grab Financial Group, said: “We are doubling down on our financial services offering for micro-entrepreneurs with ‘Grow with Grab’. This is a huge untapped opportunity for Grab Financial to support the region’s entrepreneurs who are less able to access traditional financial institutions. "
"While SMEs contribute more than 50% of ASEAN’s GDP, two thirds of SMEs cite business funding and financing as their biggest problem. The Grab app has served more than 9 million micro-entrepreneurs over the last 6 years. As a result, we can leverage our scale and data insights to bring financial services products to market at a more competitive price point than anyone else," Lai pointed out.
While Grab is the dominant company when it comes to ride-hailing in the eight countries in Southeast Asia, GoJek remains the leading provider in its home country of Indonesia.
According to CB Insights, Grab was last valued at over $14 billion while GoJek is worth approximately $10 billion.
