Advertisements

Grab eyes Singapore banking licence as regulator studies virtual banks

Grab, Southeast Asia’s most valuable start-up, is exploring a move into Singapore banking as regulators in the Southeast Asian city-state consider allowing online-only banks, four people with knowledge of the process said.

Grab is close to hiring a consultancy to advise it on its banking potential and is gearing up to apply for a digital-only bank licence in Singapore if the banking regulator decides to open up the sector, said the people, who declined to be identified as they were not authorised to speak to the media.

Singapore-headquartered Grab’s interest in what would be its first foray into banking has not been reported before.

Grab declined comment.

When asked for a response, the Monetary Authority of Singapore (MAS) referred Reuters to its comments issued last month when it said it was studying the potential for allowing “digital-only banks with non-bank parentage” into its market.

Hong Kong, Singapore’s fierce financial centre rival, began issuing licences earlier this year.

A potential entry by Grab – backed by Japan’s SoftBank Group Corp – and others would mark the biggest shake-up in years for a market dominated by DBS Group Holdings Ltd, Oversea-Chinese Banking Corp and United Overseas Bank Ltd.

The MAS could make a decision in the next couple of months on whether to admit digital-only banks with non-bank parentage, as well as the eligibility applicants, the people said.

The city-state’s banking regulator is likely to issue only two to three licences in the first phase, two of the people said.

SNAZZIER SERVICES

The interest from Grab underscores how Asia’s non-banking firms are keen to challenge traditional banks by leveraging their technology and their user databases to offer banking services to retail customers and small businesses.

Securing a digital banking licence in Singapore could help seven-year-old Grab to benefit from its existing data on transport movements, payment transactions and consumer behaviour, the people said.

Last year, Grab teamed up with Japan’s Credit Saison Co Ltd to provide loans in Southeast Asia.

Global fintech players are among other groups expected to seek licences in Singapore, with some of them looking to form joint ventures, said two of the people.

Consultants said a digital banking licence could also appeal to Singapore Telecommunications Ltd (Singtel), which is expanding beyond its traditional carrier services into areas such as mobile payments and cybersecurity.

“It is too premature to comment but having ventured into mobile financial services, we are open to exploring the feasibility of such an opportunity should it arise,” a Singtel spokeswoman said in an emailed response…https://reut.rs/2MGMhQq

Advertisements

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Powered by WordPress.com.

Up ↑

%d bloggers like this:
Skip to toolbar