Grab raises $300 million for fintech arm’s ambitious expansion

Backed by investors including Softbank Group Corp, Grab is seeking to evolve into an everyday app offering a variety of services. (AFP file photo)
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Updated 14 January 2021

Grab raises $300 million for fintech arm’s ambitious expansion

  • Grab said this is the first external funding for the fintech business
  • Grab competes with the likes of Indonesia’s Gojek

SINGAPORE: Southeast Asian ride-hailing and food delivery giant Grab has raised more than $300 million from investors led by South Korea’s Hanwha Asset Management Co. Ltd. for its rapidly-expanding financial services business.
Grab said this is the first external funding for the fintech business, which has chalked out ambitious plans in insurance, lending, wealth management and payments.
Grab competes with the likes of Indonesia’s Gojek and many local start-ups that are attracting millions of customers as they look to disrupt established financial services companies in a region home to some 650 million people.
“We are at an inflection point in Southeast Asia, as the pandemic has accelerated the need for digital financial services that help us grow and protect our incomes,” Reuben Lai, senior managing director at Grab Financial Group said in a statement.
Grab’s early backers such as GGV Capital and Singapore venture capital firm K3 Ventures also participated in the fintech arm’s funding. New investors included fintech investment firm Flourish Ventures, backed by EBay founder Pierre Omidyar.
“As more and more of our life, work and activities move online, tech platforms have played a big role in formalizing the economy,” Tilman Ehrbeck, managing partner at Flourish said.
“They have a real opportunity to bring financial services to the users who often are not reached by the traditional banking system, particularly true in Southeast Asia, which has a relatively higher mobile Internet penetration,” he said.
Reuters reported in September, citing sources, that Grab was negotiating with insurers including Prudential PLC, AIA Group Ltd. and others to raise $300 million to $500 million for the financial services unit.
In December, Internet platform company Sea Ltd. and Grab’s venture with Singtel each won Singapore’s first digital full bank licenses.
Backed by investors including Softbank Group Corp, Grab is seeking to evolve into an everyday app offering a variety of services.


UK inflation starts climb as effects of COVID-19 and Brexit combine

Updated 37 min 13 sec ago

UK inflation starts climb as effects of COVID-19 and Brexit combine

  • Inflation has been below the Bank of England’s 2 percent target since mid-2019
  • ‘We are going to be talking a lot more about inflation in 2021 than we did 2020’

LONDON: British inflation gathered speed in December, starting what is expected to be a climb this year as pandemic-fighting measures, Brexit and a recovery in the economy combine to push up costs for consumers and businesses.
Consumer prices rose 0.6 percent in annual terms after a 0.3 percent increase in November, the Office for National Statistics said.
A Reuters poll of economists had pointed to a rate of 0.5 percent.
A temporary easing of COVID-19 travel restrictions helped to push up air and sea fares while a rise in global oil prices made fuel more expensive and the price of clothes also rose.
Inflation has been below the Bank of England’s 2 percent target since mid-2019 and the COVID-19 pandemic pushed it close to zero as the economy tanked.
But it is likely to rise as the impact of value-added tax cuts and other emergency pandemic measures fade from the statistical comparisons, and because of Britain’s new, less open trading relationship with the European Union.
“We are going to be talking a lot more about inflation in 2021 than we did 2020,” said Jeremy Thomson-Cook, an economist at foreign exchange company Equals Group. “Both Brexit and COVID-19 are factors that have caused substantial pain for businesses and their supply chains.”
A Reuters poll of economists published last week showed inflation is likely to rise to close to the BoE’s 2 percent target by the end of this year, and some like Capital Economics think it will peak at 2.5 percent.
But economists see little pressure on the BoE to start raising interest rates from their all-time low any time soon with Britain’s economy still about 10 percent smaller than before the pandemic.
Samuel Tombs, an economist with Pantheon Macroeconomics, said a rise in unemployment after the end of the government’s job protection scheme — scheduled for April — was likely to keep a lid on domestic inflation pressures.
“The (BoE) will not need to even talk about the prospect of interest rates rising in future within the next two years,” Tombs said.
The ONS said air and sea fare prices rose last month, making transport services the biggest contributor to the increase in inflation during December.
Prices at petrol pumps rose by 1.5 pence per liter.
Clothing and footwear prices — which rose last month, unlike in December 2019 — also contributed to higher inflation.
The ONS said factory gate prices fell last month by the least in annual terms since March, down 0.4 percent, and the measure for core output prices rose by the most since September 2019, up 1.2 percent.