Grab, Singtel to launch banking services in Singapore

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SINGAPORE: Grab Holdings Ltd and Singapore Telecommunications Ltd (Singtel) plan to roll out a banking service next week, joining tech giants like Jack Ma’s Ant Group Co in taking advantage of the country’s fintech liberalization.

Called GXS, the bank will start offering a savings account from September 5 and plans to expand into credit products over time.

It will begin by targeting younger users and workers in the gig economy that underpin Grab’s car rental and meal delivery services, according to a statement.

Grab and telco Singtel aim to compete with tech giants Sea Ltd and Ant, which are creating digital banking products for the affluent city-state.

But they are entering a space dominated by major incumbents, including DBS Group Holdings Ltd and Oversea-Chinese Banking Corp.

Singapore joins the UK and Hong Kong in opening up to digital-only financial services, seeking to cement its position as a regional center for fintech and wealth management.

Grab, which owns 60% of the company, has relied on financial services to help it become profitable after spending money pursuing growth in ridesharing and delivery.

Grab hopes to benefit from this by offering a suite of services on its platform in Singapore, where people who use Grab to flag down rides or order food can now also access banking services.

“GXS is a local bank with a mission to serve the needs of entrepreneurs, gig economy workers and early workers in our community,” Charles Wong, chief executive of GXS Bank, said in the statement.

The bank will offer daily interest deposits – which amount to up to 1.58% per annum – and will not impose criteria such as minimum deposits, he told reporters during a briefing. hurry.

Wong, a former Citigroup Inc executive, has more than 20 years of banking experience.

He led its retail banking arm in Singapore and held roles in areas including bancassurance and wealth management before joining Grab, according to his LinkedIn profile.

Grab-Singtel was one of two groups, besides Sea, to obtain a full digital banking license in 2020, allowing it to accept deposits and serve both individuals and businesses.

The license requires 1.5 billion Singapore dollars (US$1.1 billion or RM4.9 billion) in capital as well as local control.

This compares to a wholesale digital banking license for companies like Ant, which requires a capital commitment of S$100m (RM321m) and can only serve small and medium enterprises and other segments. non-commercial. —Bloomberg

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