The partnership between Siam Commercial Bank (SCB) and Indonesian unicorn startup Go-Jek will heat up competition in ride hailing and delivery in Thailand and provide opportunities for the bank to acquire more customers.
SCB's investment in the ride-hailing app Go-Jek is in line with the bank's inorganic growth strategy and digital banking expansion.
Go-Jek is raising fresh funds in the Series F funding round, in which SCB participated. But the bank, Thailand's largest by asset size, did not disclose its investment value.
"Apart from financial solutions, lifestyle services are another key area that Go-Jek can contribute towards the bank's business in the long term," said SCB co-president Arak Sutivong.
The partnership will help the bank broaden its platform to keep pace with consumers' lifestyles and expand the customer base, he said.
SCB's partnership with Go-Jek marks the bank's first investment after recently announcing an inorganic growth strategy, which include mergers, acquisitions, partnerships and joint ventures.
Last year, Go-Jek expanded into Thailand by providing motorbike-hailing and on-demand delivery services through the Get app. Its services are considered to compete directly with Singapore-based Grab.
Go-Jek's Get has 20,000 motorcycle drivers for food and parcel delivery and 20,000 restaurant partners, with 1 million downloads in Thailand. SCB Easy, the bank's mobile banking app, has more than 9 million users.
SCB co-president Apiphan Charoen- anusorn said the bank plans to offer banking services and financial solutions to related parties under Get's solid platform.
The bank plans to start offering digital lending services to Get drivers in the fourth quarter this year.
Initially, SCB expects to provide personal loans for motorcycle purchases and educational loans through digital channels to around 10,000 Get drivers.
SCB also offers several promotional campaigns for food delivery via Get.
Pinya Nittayakasetwat, chief executive of Get, said the app's 10-baht delivery service charge, applicable since February, draws users.
Get is sticking to pricing competition after joining forces with SCB by offering up to three free food deliveries to new customers and three 50% discounts for existing users.
Bangkok's population is 10-15 million, 2-3% of which uses food delivery apps.
After teaming up with SCB, Get expects the penetration rate to be in the double digits this year. Get users can use the SCB Easy app to top-up their Get wallet; merchants can transfer money from Get Pay to SCB accounts without any fee.
Mr Pinya referred to a Google-Temasek study naming Thailand the second-largest internet economy in Southeast Asia, worth US$12 billion, accounting for 2.7% of Thai GDP.
Get offers four services: Get Win (motorcycle taxi stand), Get Food, Get Messenger and Get Pay e-wallet (still in beta).
Get plans to open ride-hailing services if the new government legalises such services.