Grab is exploring a move into banking in Singapore, Reuters reported today (12 June 2019) citing four unnamed sources “with knowledge of the process”.
This comes as the Monetary Authority of Singapore (MAS) is currently in consideration of whether to admit digital-only banks set up by fintech firms with no banking parentage.
The authority could have its decision in the next few months, along with eligibility requirements for firms that wish to be licensed.
Already, Grab is close to hiring a consultancy for advice on their banking potential, and preparing to apply for a license if the virtual banking sector gets a green light.
Grab’s interest in this field is no surprise, as the company has partnered with Credit Saison to provide loans since early 2018, and later tied up with Chinese internet-based insurer ZhongAn Online P&C Insurance Co to create a digital insurance platform in Southeast Asia.
This year its fintech arm also launched credit services that allow consumers to pay for their purchases at the end of the month, or split payment over a few instalments.
Two of the sources believe MAS is likely to issue only two or three licenses in the first phase, if they do approve digital-only banks.
Similarly to Hong Kong, which recently began issuing licenses, virtual bank players in Singapore could be offering savings accounts, personal loans, and travel insurance.
As Grab has already been setting up their capabilities in a few of these areas, the firm probably has a foot in the door to make their entrance into banking if the opportunity arises.
Featured Image Credit: Grab