The services will tap into the “huge cache” of customer data from the Grab app to provide credit ratings.
Grab Inc. (Grab) and Japan consumer financing firm Credit Saison Co., Ltd. (Credit Saison) formed a joint venture (JV) to provide loans and lending services to consumers, micro-entrepreneurs, and small businesses across Southeast Asia.
According to a statement, the JV, called Grab Financial Services Asia, is part of the launch of Grab Financial, the fintech platform within the Grab ecosystem. Encompassing all of Grab’s fintech offerings, Grab Financial offers payments services, rewards and loyalty services, financial services and agent services.
Grab noted that Grab Financial Services Asia taps into Grab’s huge cache of customer data gathered from the Grab app, which processes over a billion transactions annually, to provide a
sophisticated, alternative resource for measuring credit ratings. “By analyzing behaviour and transaction data from the app, such as transport movements, geo-location, and GrabPay transaction data, the company can offer alternative data points to assess creditworthiness, filling the gap left by traditional credit scoring methods.”
The company added that using this data and Credit Saison’s expertise in credit scoring, risk management, and product formulation, the JV will offer a range of lending products and services. “In the early stages, the JV will focus on providing products to meet the needs of Grab drivers, agents and merchants, such as working capital loans, financing for smartphones and durable goods, as well as consumer goods financing. In addition to providing its own financial products, in the near future the JV will also offer credit scoring services to Financial Institutes who can use the information to provide other services such as virtual credit cards,” it said.
Grab Financial Services Asia is also eyeing partnerships with banks and financial institutions in Southeast Asia and globally to provide other financial products. This is “enabling these traditional institutions to unlock new opportunities in segments that they have been unable to address due to the absence of reliable credit information,” Grab said.
According to the statement, Credit Saison is the largest credit card issuer in Japan, with 35 million credit cards and 36 million pre-paid cards in circulation that bill US$62b annually. Its product portfolio includes unsecured consumer lending, shopping credit loans, mortgage loans, micro/auto insurance and leasing. It is also an active technology investor, currently investing in wallets, e-commerce, payment gateways, mobile point of sale (mPOS), biometric payments, location-based marketing, Internet of Things (IoT) and robo-advisory.
GrabPay Southeast Asia managing director Jason Thompson said, “The new joint venture, Grab Financial Services Asia, puts in place a much-needed infrastructure that will accelerate financial inclusion in Southeast Asia. Many in our region have no access to loans that they can use to purchase a new home or grow their small business. GFSA is building a reliable alternative to traditional credit scoring methods that are customised for the unbanked majority of consumers and small businesses in Southeast Asia, which will create economic opportunity for millions across the region.”
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