Grab, which has ambitions in the financial services space, has been given a boost with a strategic investment by the leading Japanese bank.
Mitsubishi UFJ Financial Group (MUFG) is set to make a strategic investment of 80 trillion yen ($727 million) into Singapore-based tech and ride-hailing giant Grab as part of the bank's digital push into the region.
Through the partnership, the bank aims to offer a range of financial services and loans to Grab's wide user base across Southeast Asia, according to a report in «Nikkei Asian Review,» which cited people close to the matter.
The report said Grab will make use of its data on customer preferences to suggest loans tailored to specific customers. Grab will also tap on MUFG's capabilities in screening borrowers' creditworthiness and to collect loans, as well as in negotiating regulatory approvals with financial authorities in various Asian countries.
Financial Ambitions
Grab has long had ambitions in the financial services space, saying it wants to be the region's largest merchant network, insurtech policy provider and fintech lender. It has partnered with Singtel to bid for one of five digital bank licenses in Singapore, the recipients of which will be announced later this year.
Grab has built solutions in payments, rewards, lending, and insurance under its GrabPay wallet and Grab Financial in the last two years. The company has already dished out loans to several SMEs in Singapore via its joint venture with the Japanese financial services group Credit Saison.
Earlier this month, Grab announced the acquisition of Bento Invest, a Singapore-based robo-advisory start-up, through which it will offer retail wealth management solutions to users, driver-partners, and merchant-partners via its app.
MUFG Gears Up for Competition
According to the report, MUFG is also interested in Grab's strength in artificial intelligence systems and data analysis, as it competes more with online banks and IT startups in its home market.
Southeast Asia is also an important growth market for the bank, which is dealing with a prolonged economic slowdown in Japan.
