In November last year, Grab’s Upfront Cash Programme which was first introduced in 2018 became a topic of contention.
The programme allows select Grab driver- and food delivery-partners to take a cash advance on their future earnings, and pay it back in instalments over up to 26 weeks.
There is no interest charged, but applicants have to pay a one-time administration fee ranging from 5 to 10 per cent of the cash advance amount.
It was intended to help drivers and food delivery partners who need better cash flow options to settle important immediate expenses.
Some Grab drivers had voiced out that they felt “trapped” after taking the cash advance, when fluctuating fares and incentives later made it hard for them to fulfil repayment.
In turn, this caught the attention of Government Parliamentary Committee of Manpower Deputy Chairman, Zainal Sapari, and the Ministry of Law.
The Ministry of Law said it was “seeking further information” from Grab, and working with relevant agencies to “ascertain the applicable legislation”.
While looking into the Upfront Cash Programme, Minister for Law K Shanmugam strongly encouraged drivers to “review the terms of the [programme] carefully and assess their ability to complete the requirements and meet the financial commitments before participating in the programme”.
Upfront Cash Programme Comes To An End
The Straits Times reported on Sunday (23 Feb) that Grab has now cancelled the Upfront Cash Programme.
“In line with our focus on innovation and continuous commitment to serving our partners, we have discontinued the Cash Upfront programme to explore improvements that can be made to ensure the needs of our driver and delivery-partners are best met,” Grab said in a statement.
The company did not provide further reasons for the termination.
Some drivers have been welcoming of the Upfront Cash Programme, saying that it was helpful and didn’t pose any problems with repayment.
Grab also said that 98% of drivers who had opted-in to the programme since launch were able to earn and return their incentives.
The Ministry of Law advised that businesses including Grab should be responsible for ensuring that their services offered are lawful.
Businesses should obtain a license or exemption to provide moneylending services if their activities may constitute as moneylending.
Featured Image Credit: Grab
