Grab, a Southeast Asian rideshare company and online financial services platform introduced micro-loans and insurance options on Tuesday for Grab drivers and businesses.
For the new offering, Grab formed a joint venture — called Grab Financial Services Asia — with Japanese credit card company Credit Saison. Separately, U.S.-based insurer Chubb signed on as a partner.
Grab declined to specify how much of the joint venture it owns, or to provide details of the micro-lending operation. In the United States, micro-loans range from a few hundred dollars to $50,000, with the average loan at $13,000.
“While we don’t disclose the average expected loan size, we will tailor loans to the specific needs of unbanked and underbanked consumers, micro-entrepreneurs [who receive small loans to start businesses], and small businesses in different locales across Southeast Asia,” a spokesperson told Auto Finance News.
Grab has funded more than $737 million to drivers for car leasing and smartphone financing, and it has maintained a default rate of less than 1.5%. The company expects to preserve this rate as it expands into micro-lending, though the spokesperson declined to offer specifics.
Through the venture, Grab will also offer credit scoring services to financial firms by gathering and analyzing alternative data points on consumer behavior, “which can be used to develop sophisticated credit and risk assessments,” the spokesperson said.
Grab, which operates in eight countries in Southeast Asia, offers ride-hailing and on-demand food and delivery services through its 2.6 million drivers. The rideshare app has more than 86 million downloads.
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