Singtel and Grab are looking to consolidate their powers to create a new digital bank for the people of Singapore, they announced in a press release.
Singtel, Asia’s leading communications technology group, and Grab, Asia’s leading super app, have formed a consortium to enter digital banking and help the communities of Singapore that have traditionally been left behind in banking matters, the press release said.
Singtel will hold a 40 percent stake and Grab will hold 60 percent, according to the release.
The bank will be able to serve retail customers, lend money and take deposits, along with other online banking functions.
Both Singtel and Grab have dabbled in the financial realm before, with apps like Dash, VIA, GrabPay and GrabInsure. Grab, which started out as a ridesharing company, has been introducing finance apps and payment solutions since 2016. Recently, it announced a new ‘GrabPay’ card, a numberless card that can be used to pay for services at nearly 53 million merchants worldwide. Grab also recently said it wants to expand into artificial intelligence.
Singtel, meanwhile, has been working on solutions such as eWallets and allowing customers to use those eWallets to pay for things overseas.
Reuben Lai, Senior Managing Director with Grab Financial Group, said the core of their mission has always been to “solve everyday challenges and unlock economic potential” in the region.
Singtel CEO Arthur Lang said the company’s mission is to be an enabler of change.
The Monetary Authority of Singapore announced that it will be issuing up to five digital bank licenses for companies looking to offer the service that don’t already have established records in banking. Other companies considering doing so include Standard Chartered Bank, NTUC Enterprise, the V3 Group and Razer.
Singtel and Grab will know if their application has been accepted by mid 2020, reports state.
The move is coming in the middle of Singapore’s biggest liberalization of its banking sector in years, which will open up opportunities for online-only banks that can operate with less costs than physical ones.