Grab offering loans, insurance with new fintech platform

Darnell Taylor
March 15, 2018

Grab's new venture will offer credit scoring services to financial firms who can use the information for services such as virtual credit cards.

To provide loans to consumers, micro-entrepreneurs and small businesses across South-east Asia, Grab has embarked on a joint venture agreement with Credit Saison, one of Japan's largest consumer financing companies.

Singapore-based Grab has launched a new fintech platform that offers loans and insurance, starting with its driver-partners and "middle economy" business owners.

Ride-hailing company Grab launched Grab Financial, the firm's new fintech platform on Tuesday, March 13, at the Money 20/20 event. He further added, "Many in our region have no access to loans that they can use to purchase a new home or grow their small business".

According to the managing director of Grab Financial, Jason Thompson, the joint venture will create the infrastructure that will promote financial inclusion.

The company will use Grab's vast customer data as a means to measuring credit ratings.

This way, Grab Financial can offer alternative data points to assess credit worthiness in ways traditional credit scoring methods have not been able to, the company said. Soon, credit scoring services to banks and other financial institutions will also be offered, so these institutions will be able to use the information to offer other services.

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At the start, the joint venture will focus on providing products to meet the needs of Grab drivers, agents and merchants, such as working capital loans, smartphone financing and consumer goods financing. Its product portfolio includes unsecured consumer lending, shopping credit loans, mortgage loans, micro/auto insurance and leasing. However, the region is also notoriously hard for financial services providers to crack, on account of low ownership and usage of bank accounts; a 2016 KPMG study estimates that only 27 percent of the region's 600-million-strong population has a bank account. Smartphone use is growing the region, however, and Grab now has about 86 million downloads of its mobile app. US-based insurer Chubb is also signed on as a partner.

Grab is now in discussions with more than 60 financial institutions connected on its platform. We are excited to have a partner such as Chubb with whom we share this vision.

Grab, once an underdog compared with bigger rival Uber Technologies, has become the dominant player in southeast Asia after winning customers from Singapore to Vietnam.

Beyond that, we can also expect Grab Financial to introduce new insurance products catered to the digital audience in Southeast Asia.

Grab Financial will offer insurance options to its 2.6 million driver-partners, underwritten by Chubb.

This new partnership is an extension of Grab's long-term commitment to improve driver welfare.

Chubb said it is investing in product innovation, analytics and technology to provide an "anytime-anywhere" customer experience for its clients and distribution partners.

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