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    3 POINT PERSPECTIVE  |  INNOVATION EDGE

    Building digital ecosystems that drive value

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    Contributor: Ming Maa

    09 Feb 2022

    Originally conceived in 2012 as a way to make taxi rides in Malaysia safer and more reliable, Grab has since grown into a multi-national super-app, offering a whole host of services including transport, food, groceries and package delivery, fintech and much more. As part of our Asia Forum, Ming Maa, Group President of Grab shares his insights on what’s next for the region’s digital platforms.

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    Contributor: Ming Maa

    09 Feb 2022

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    Building digital ecosystems that drive value
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    1. Super-apps are changing the game

    Digital platforms that combine financial, transportation, retail and other offerings have already transformed the way people in Southeast Asia bank, shop and travel. They have also expanded the earnings potential of many workers through the gig economy.

    Super-apps enable consumers to conveniently access different types of services at their fingertips, all in a single app. A key factor behind how Grab became a regional market leader in food deliveries so quickly was its existing ride-hailing consumer base starting to use food delivery services too.

    Since December 2018, Grab has seen the percentage of monthly transacting users (MTU) using two or more services grow by 60%, from 33% of total MTUs to well over 50% as of June 2021.

    Beyond straightforward services such as booking a ride or sending a package, the integration of financial services is ushering in the next generation of the super-app.

    Every transaction is an opportunity to offer a user specific, customised financial product, whether it's payments, buy now, pay later or even insurance. For instance, in Singapore, driver-partners can pay as little as S$30 cents per trip to get up to S$200,000 of coverage.

    2. We need to build 'digital rails'

    Just as physical railways were the critical infrastructure of the industrial revolution, proper “digital rails” are increasingly required for our modern economy.

    Even in Singapore, which has a relatively mature market for financial services, 40% of Singaporeans are either unbanked or underbanked1. Serving the needs of this segment will be the key focus of the Grab-Singtel digital bank which is currently scheduled to be launched later in 2022.

    As more companies get involved, the entire ecosystem should grow, giving consumers even more choice.

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    Moreover, while current payment rails are robust, interconnectivity and interoperability are also key in driving adoption.

    To accelerate this, government readiness and support are vital. In Southeast Asia, central banks have opened up closed-loop interbank systems and invited selected e-wallets such as GrabPay to join PayNow in Singapore, DuitNow in Malaysia and InstaPay in the Philippines.

    In April 2021, the linkage of Thailand’s PromptPay and Singapore’s PayNow was the first instant cross-border payments infrastructure to be established globally and facilitates faster and cheaper cross-border transfers.

    Such developments are important in driving financial inclusion across Southeast Asia, and much more can be done.

    3. Appropriate regulation facilitates growth and reduce risks

    As much as industry participants look ready to forge ahead and launch even more new digital services, governments have an equally important role in developing appropriate regulation to build a robust yet sustainable digital economy. Regulations create the basic environment for businesses to thrive, and governments must tread a fine balance between facilitating growth and mitigating public risks.

    Industry can contribute useful input to help governments find the balance between ensuring that regulatory frameworks are appropriate in supporting businesses and setting consumer protection safeguards.

    Singapore, Malaysia, Thailand and Indonesia’s fintech regulatory sandboxes are a positive example of where government and industry have come together to understand what makes appropriate regulation. This framework helps spur innovation as companies have the freedom to experiment without the initial constraints of formal regulation. It also gives governments an opportunity to become familiar with cutting-edge technologies, understand risks and build their knowledge base before regulating the right areas.

    Source: UNSGSA Briefing on Regulatory Sandboxes

    The financial industry’s use of regulatory sandboxes may provide a model for other sectors to consider. As Southeast Asian governments consider regulation in areas such as data privacy, consumer protections, trust and security, continued engagement with industry players will be critical to ensuring that the regulatory environment is conducive for digital platforms and companies to continue serving and providing value to the millions of consumers that use them for myriad everyday services.

    1 Bain and Company

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    About the expert

    Ming Maa

    President, Grab

    Ming Maa is the Group President of Grab, responsible for corporate development activities, including strategic partnerships and investment opportunities, managing the company’s overall capital structure, and other corporate activities. Ming has over 12 years of finance and investment experience across the U.S. and Asia. He joined Grab from SoftBank Group Corp., a leading global technology company and one of Grab’s key strategic investors, where he was based in Tokyo and helped to oversee SoftBank’s investments in leading companies in the ridesharing and e-commerce industries, including SoftBank’s April 2015 Series D investment in Grab and additional Series F investment in September 2016. Prior to joining SoftBank, Ming was a Principal at Ancora Capital Management Pte Ltd based in Jakarta. Prior to Ancora, between 2000-2012, Ming was a Vice President in Goldman Sachs’ Merchant Banking Division, the firm’s global private equity group, and was based in Tokyo, New York and San Francisco. At Goldman Sachs, he managed investments across a wide spectrum of industries and served on the boards of several technology and media companies. Ming received his Bachelor of Science and Master of Science degrees from the Massachusetts Institute of Technology.

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