Lending

How Grab Is Breaking Into the Lending Space in Their Lead up to Be a Digital Bank

Singapore-headquartered superapp Grab has begun offering loans and credit lines to businesses in the city state.

Under the GrabFinance brand, the tech company is now providing local small and medium-sized enterprises (SMEs) with quick and accessible funding. Business owners can apply online and borrow up to S$100,000 with interest rates as low as 0.7% a month. There is no security deposits required and loan sizes are calculated based on their current financial standing.

Ride-hailing giant Grab launched SME lending as well as micro-insurance for drivers in Singapore in March 2019, announcing at the same time its Grow with Grab roadmap.

The roadmap aims to provide the most comprehensive portfolio of financial services for micro-entrepreneurs and small businesses in Southeast Asia, and marked Grab Financial Group’s full-scale push into lending and insurance. It includes a range of other new services, including post-paid and installment payment services as well as Pay with GrabPay, an online check-out payment method for online sellers.

To be eligible for a loan, a company must be either a limited liability partnership or a limited liability company. It must be at least 30% owned by a Singapore citizen or permanent resident, have a staff size of less than 200 people, and be in operation for at least 6 months.

The approval takes up to five business days upon receipt of the completed application and submission of required documents. Upon acceptance and approval, applicants receive their funds in three business days.

Why GrabFinance? via https://www.grab.com/sg/merchant/finance/businessloan/

For drivers, GrabFinance has also been offering financing options since the early 2019. These include the Upfront Cash Programme, which is offered to select group of Grab drivers and delivery partners who can choose to request for an earlier payment of their incentive earnings, as well as the Shop Now Pay Later – Smartphone program, which extends the opportunity for eligible Grab driver-partners to purchase the latest smartphone at a heavily discounted price and pay later.

Grab first got into fintech back in 2016 with the launch of the GrabPay wallet. In 2018, it launched Grab Financial Group, its fintech arm, which has set out to become Southeast Asia’s largest payments and financial services platform. Since then, the company has built solutions in payments, rewards, lending and insurance.

The Pay with GrabPay online check-out solution, for example, allows online sellers to accept GrabPay as a mobile wallet on their website or platform, and most recently, it launched GrabPay Card, Asia’s first numberless card.

GrabPay Card runs on the Mastercard network and promises greater security. The card, available in both digital and physical forms, is the culmination of Grab’s ongoing partnership with Mastercard. The company plans to launch the digital GrabPay Card in the Philippines in Q1 2020, with other Southeast Asian countries to follow in the first half of the year.

Grab is also one of the contenders for the Singapore digital banking licenses. The company partnered with Singtel last year to form a consortium with the ambition to serve financially underserved consumers and enterprises in Singapore.

Featured image: GrabFinance, via https://www.grab.com/sg/merchant/finance/businessloan/