Grab, the ride-hailing service, is heavily linked to a deal of buying out the Southeast Asia business of Uber, but the rumors have not stopped the company from building its platform of fintech after announcing its financial services unit.
The company, which is based in Singapore, has been pushing into fintech for quite some time, with the most visible push coming with the launch last November of its mobile payments service.
Today, that has been extended even further by the company introducing options for micro-loans and insurance for drivers of Grab and businesses that use its services GrabPay.
For the new offerings, Grab has joined forces with Credit Saison, a firm worth $3 billion that is the largest lender in Japan with 70 million credit cards already in circulation that will create a joint venture known as Grab Financial Services Asia. Chubb, the insurer based in the U.S., has signed to be a partner.
Instead of pumping possible financial services clients with alerts through its app, Grab is planning to take an approach that is community drive and promote availability of services using driver events, its agents network and other means offline.
Credit scoring has become very tricky in many of the emerging economies since a vast proportion of the population does not have bank accounts or if they do, they are not used on a regular basis.
It is estimated by KMPMG that in Southeast Asia, where only 27% of the 600 million population, in the region own a bank account.
Grab is planning to assess insurance candidates and loan recipients using a selection of different signals that could include the driving style of the candidate, which can be tracked through telemetric from a device of the driver.
Grab is focused initially on serving its business customers, but has said that it might look at expanding to cater to consumers in the future. Already, Grab has a loan portfolio of more than $700 million following campaigns to provide financing for vehicles.
Grab services eight nations across Southeast Asia but its push into financial services has appeared to take in an approach of Indonesia first.
The country, which is the largest economy in Southeast Asia’s, is where Grab was able to acquire Kudo, the offline payment network, in a deal worth over $100 million said sources through the two companies.