Last year, the company received a $14 billion valuation, which Bloomberg states make it Southeast Asia’s most valuable corporation
FREMONT, CA: Grab, a Singapore-based ride-share startup, raised more than $850 million from Japan’s Mitsubishi UFJ Financial Group (MUFG) and TIS to bankroll its expansion into financial services in the region.
The sum includes $706 million from MUFG, Japan’s largest bank, and $150 million from TIS, a provider of data center and cloud services. The company will use the funding to offer lending, insurance, and wealth management products and services for Southeast Asian consumers and small and medium-sized enterprises.
Backed by SoftBank Group, Grab has been expanding into financial services, building on its ride-hailing, food delivery, and e-wallet offerings to become a one-stop-shop for on-demand services in Southeast Asia. Tie-ups between tech startups and banks are becoming more common in the region, where widespread smartphone use promises greater access to clients who have traditionally been neglected by the financial system.
Grab will co-develop financial products and solutions with the two investors. “Ensuring greater access to affordable and accessible financial services and products is key to growing financial inclusion in Southeast Asia,” Ming Maa, Grab’s president, said.
The Singaporean concern stated it would team with its new backers to develop financial products and services. Specifically, the three companies intend to share their data to establish a new lending “scoring model.” Grab should be able to provide its partners with a wealth of consumer information as its signature app has been downloaded more than 166 million times. Moreover, the service acquired Uber’s Southeast Asian business back in 2018.
The Southeast Asian ride-share company will also work with its new affiliates on two other functions. Grab will now use MUFG and its local subsidiaries as its “first choice bank.” As such, the Japanese institution will serve as the default selection for customers who want to use the firm’s in-app financial services. As such, the bank will be able to generate new business abroad to make up for a weakness in its domestic market.
Similarly, the ride-share firm and TIS will work together to build a digital payment feature for the Grab application.
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