Grab's unique position to tap into Asia's huge un- or underbanked segment illustrates why financial services is a key strategic pillar for the firm. The majority of SEA's 600 million-plus population don't have a bank account,. And this scarce infrastructure means capturing the region's fast-growing market is especially difficult for incumbent financial institutions .
For legacy players, partnerships with platform-based businesses like Grab offer a rare opportunity to tap into these players' huge user bases. In the past, being relevant to, and reaching, consumers meant FIs needed to have a large footprint of physical branches. As more and more consumers turn to digital platforms for their needs, including financial services, these physical presences are no longer necessary.
Instead, by partnering with the likes of Grab, incumbents like Experian and FIs like Citi can tap into these players' ecosystems and reach huge numbers of consumers. Citi's partnership with Grab, as well as Goldman'swith Apple to launch cobranded credit cards, is an example of this growing trend. However, as more incumbents look to ink deals with digital players, the competition to sign up the most successful platforms is going to be fierce.
Given this, we anticipate established FIs that fail to adequately transform their businesses for the digital age will struggle to position themselves as preferred partners for the likes of Grab.1. Sign up for the Fintech Briefing to get it delivered to your inbox 6x a week. >>pass to Business Insider Intelligence and gain immediate access to the Fintech Briefing, plus more than 250 other expertly researched reports.