The first step in Grab's super-app strategy was buying Uber's Southeast Asia business in March 2018. Uber got a 27.5% stake in Grab from the deal, and its CEO Dara Khosrowshahi joined Grab’s board. Uber floundered in Southeast Asia just as it did in China, where able local rival Didi Chuxing better understood the market. Uber couldn't keep burning through cash ahead of an expected IPO in 2019, so a deal with Grab made sense.
With Uber out of the way, Grab's foremost competitor is Indonesia's Go-Jek, which is also foraying into Southeast Asia's fintech market. Both firms are partnering with heavyweight Singapore banks: Go-Jek with DBS and Grab with UOB. Grab is also teaming up with Credit Saison to offer a post-paid and installment payment service. In the fintech segment, Grab has an edge over Go-Jek in its home market of Singapore, while Go-Jek has a clear advantage in the huge Indonesian market. The rest of Asean is, well, up for grabs.
In a March 19 statement, Grab sounded a bullish note on its fintech prospects. "Grab Financial Group aims to become both one of the region’s largest merchant networks, with the largest insurtech policy provider and the biggest fintech lender, all within one platform," the company said.
In the statement, Reuben Lai, Senior Managing Director of the Grab Financial Group, noted that 2/3 of SMEs in Asean say that funding is their largest problem. Given that Grab's app has served some 9 million micro-entrepreneurs since 2013, Lai expects that the firm will tap its "scale and data insights to bring financial services products to market at a more competitive price point than anyone else."
In April, Grab will launch its insurance marketplace, including medical leave insurance, personal accident insurance, pay-as-you-drive auto insurance, micro-life insurance and critical illness insurance.
With its large suite of services, Grab is "beating Southeast Asia’s fragmentation problem by bringing together the largest payments and financial services ecosystem," Lai said.