Grab, the Singapore-based ride sharing turned “super app”, has landed a $300 million Series A funding round for its fintech arm.
Led by Hanwha Asset Management – one of South Korea’s Big Three – the round also saw participation from early Grab backers K3 Ventures and GGV Capital. Flourish Ventures, the venture capital firm funded by eBay’s founder Pierre Omidyar, and Arbor Ventures, also participated in the round.
It says it will use the funding to keep serving Singapore’s unbanked population. Southeast Asia as a whole houses an unbanked population of around 290 million, according to US credit agency Fitch Ratings.
The fintech arm, called Grab Financial Group, saw its total revenues jump up by more than 40% in 2020, compared to 2019.
Just last month, Grab and its partner – major Asian telco Singtel – became just one set of two recipients of Singapore’s much-prized digital full banking (DFB) licence.
A DFB licence will allow it to hold retail deposits. The firm beat heavyweight competitors for the licence – namely Razor, the gaming giant which, like Grab, is seeing the benefits of branching out into banking.
Grab’s financial play
Last August, Grab launched its first micro-investment service, alongside a third-party loan platform, and buy now, pay later (BNPL) products for e-commerce websites.
The product releases solidified its move into financial services. Having previously focused on other “super app” functionalities such as food deliver, ridesharing and ticket-buying.
Called AutoInvest, Grab’s micro-investing offering allows Singapore-based users to automatically invest with every transaction.
Customers set the limits, which can be as low as $1. They can earn returns of around 1.8% per annum, which can be withdrawn at any time with no penalties. But any returns they do make have to be cashed out through the GrabPay wallet.
It claims the wealth management offering nearly doubled monthly users in December.
This product launch followed Grab’s acquisition of robo-advisory firm Bento back in February 2020. Launched a month later was GrabInvest, of which AutoInvest is a part.
As for the Singaporean fintech’s credit offering, it has opened up its consumer loan platform to third party providers via banks’ application programme interfaces (APIs). This allows Grab users to search for and apply for loans directly within the Grab app.
Whilst Grab’s BNPL lets users shop online and choose the option to pay in interest-free instalments at the checkout.
In its most recent statement, Grab says it has also distributed more than 70 million insurance policies since launching GrabInsure last April. This service alone now has 4.5 million users, according to the fintech.