Grab now has more rivals than ever before
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From an e-hailing app, Grab has made great steps forward, providing many different services. Most recently, it started the payment service GrabPay and lending service Grab Financial.
The consumer lending market in South East Asia is very large. As estimated by the World Bank, about 2 billion people in the world cannot access bank services, and most of them are in Asia Pacific.
The non-cash payment market, according to Grab, is worth $500 billion in South East Asia.
An analyst commented that Grab is wise taking a ‘roundabout’ approach to consumer lending (it conquered the transport market first before aiming for the consumer credit market).
Consumer lending is a fertile business field for Chinese e-commerce firms. The firms offer online payment apps to users to ‘learn’ about their financial capability.
Grab, as an app, quickly attracted users, especially investors. Just within six years, Grab became an unicorn company, i.e. an unlisted technology firm with valuation of $1 billion and higher, in South East Asia. Analysts estimate that Grab is valued at $6 billion.
The total number of Grab downloads has reached 95 million all over South East Asia. This could serve as the launch pad for it to conquer the consumer lending market.
The challenges
“GrabPay e-wallet will be used for both transport and food delivery services, two of the most used services in South East Asia,” said Jerry Lim, director of Grab Vietnam.
However, the analyst said, by expanding its business, Grab would have to compete with more rivals who are ‘powers’ in their fields. In online payment, for example, it will have to compete not only with AirPay (Sea) and Alipay (Alibaba Group), but also with local firms such as ZaloPay (VNG) and MoMo.
In Indonesia, Grab bought an e-commerce platform, Kudo, in April 2017. Grab believes that this is the factor which can help expand GrabPay. However, in Vietnam, Grab’s two big rivals – Sea and Alibaba — both have strong support from two popular e-commerce floors – Shopee Vietnam and Lazada Vietnam.
Similarly, GrabFood has rivals in the food delivery sector, where Sea’s Now, which inherited the large custom from Foody, is the leader.
Questions & Answers
Q.What new services has Grab recently introduced to the market?
What new services has Grab recently introduced to the market?
Grab has recently expanded its offerings by launching GrabPay, a payment service, and Grab Financial, which provides lending services. This diversifies its portfolio beyond its initial e-hailing app roots.
Q.How large is Grab's current valuation, and how many downloads has its app achieved?
How large is Grab's current valuation, and how many downloads has its app achieved?
Analysts estimate Grab's current valuation at $6 billion, qualifying it as a unicorn company. The Grab app has also achieved a marker with 95 million downloads across South East Asia.
Q.Who are Grab's main competitors in the online payment and food delivery sectors?
Who are Grab's main competitors in the online payment and food delivery sectors?
In online payment, Grab competes with AirPay, Alipay, ZaloPay, and MoMo. For food delivery, its rival is Sea's Now, which has a strong customer base inherited from Foody.
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