Grab readies e-wallet with KBank for the unbanked

Grab readies e-wallet with KBank for the unbanked

Mr Tarin and country marketing head Chantsuda Thananitayaudom celebrate Grab's sixth anniversary in Thailand.
Mr Tarin and country marketing head Chantsuda Thananitayaudom celebrate Grab's sixth anniversary in Thailand.

Grab Thailand has become the latest to join the fintech frenzy, aiming to launch an e-wallet in partnership with Kasikornbank (KBank) this month, backed by data from users and drivers to reach Thais who do not have bank accounts.

By entering the digital payments sector, Grab will build upon its long-stated goal of becoming a "super app" along the lines of China's WeChat, accomplishing virtually all user needs inside a single app.

"By the second half of this year, we will open the GrabPay by KBank wallet in collaboration with Kasikornbank, followed by further nanofinance and microloan services," said Tarin Thaniyavarn, country head of Grab Thailand, the local arm of the Singapore-based unicorn startup.

Grab and KBank entered a partnership in November 2018, under which KBank, through its corporate venture capital firm Beacon VC, invested US$50 million in Grab.

Oddly enough, KBank has also partnered with Grab's competitor Line, which claims to have a fintech product in the pipeline coming out some time next year in affiliation with KBank.

Mr Tarin said the first phase will be the co-branded mobile wallet application to support payment for Grab's transport and delivery services.

In the next phase, the wallet will allow payments beyond the scope of Grab's app, such as transferring funds to individuals and purchasing products online or making QR code payments at stores.

Mr Tarin said Grab also received a nanofinance licence from the Bank of Thailand to take advantage of huge opportunities in increasing financial inclusion among poor Thais.

"We have data on our driver partners [those who drive for Grab], many of whom cannot access financial systems," he said. "By using data analytics, Grab has the ability to offer microloans."

Grab Thailand is also pinning expansion hopes on the new government by fully legalising its ride hailing service by the end of the year to allow unlicensed vehicles to pick up passengers. Grab is already practicing this, skirting a lightly enforced law.

"We are waiting for a new cabinet to further discuss the topic with the new transport minister. We notice that the new government is likely to have a positive policy towards ride-hailing," Mr Tarin said.

Thailand is still the only country in Southeast Asia that has still not legalised ride-hailing.

Since beginning operations since 2014, Grab has had 320 million bookings (as of June 2019), the bulk of which are done by licensed taxi cabs.

Bookings have rapidly increased from 100 million in June 2017 to 320 million within two years. Grab has hundreds of thousands of Thai drivers and delivery partners, including licensed taxis and motorbikes.

To date, Grab passengers have travelled 1.2 billion kilometres, equivalent to 700,000 trips driving from the far North in Thailand (around Phrae province), straight to the Deep South (around Narathiwat province).

Mr Tarin said GrabFood is seeing the highest growth among segments, despite the highly competitive price war in the food delivery market that is expected to continue for the next 12 months.

Grab claims to have 50% market share for app-based food delivery. For the whole year of 2018, GrabFood served 3 million orders in Thailand, which has risen sharply to 4 million orders in the first four months of 2019 alone.

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