Are Grab’s and GoTo’s fintech strategies diverging?

Photo credit: GoTo Group

Many comparisons have been drawn between Grab and GoTo – Southeast Asia’s two leading super apps – over their lifetimes. From a core ride-hailing offering in the beginning, both grew to include financial services in their platforms. They also both run digital banks.

While the two companies are leaning on financial services, especially lending, to drive their next phase of growth, their strategies appear to be diverging.

In the past quarter, GoTo has taken a more aggressive stance toward product launches and offering payment services outside its ecosystem as it inches closer to profitability.

“Over the course of six weeks in the third quarter, we launched four new products and features,” GoTo group CFO Jacky Lo said during the firm’s most recent earnings call.

These include cash loans on Tokopedia and a stand-alone GoPay app aimed at targeting mass-market consumers that may not use the Gojek or Tokopedia platforms.

“All of these launches represent continued sustainable growth for fintech on the payment and lending side of the business,” Lo added.

Meanwhile, Grab turned profitable on an adjusted EBITDA level in Q3 – the first time it has ever done so. It’s now ramping up its digital banking offerings and lending products after shutting less commercially viable ones like GrabInvest.

GoTo adds four new products while Grab shutters one

For GoTo, a focus on “open-loop” expansion – transactions outside of its own ecosystem – could give it the boost it needs, both in new users and in high-margin lending transactions.

Two of the firm’s new products – cash loans on Tokopedia and cash loans on the GoPay app – aim to further drive up loan volumes and revenues.

Four months after its launch in July, GoPay has been downloaded 6.3 million times with 4.9 million weekly active users, according to Data.ai.

According to GoTo, approximately 50% of the GoPay app’s transacting users are either new or “reactivated” (returning users), and around a quarter of them have subsequently transacted on either Gojek or Tokopedia.

Among its newest offerings, GoPay Tabungan (savings) by Bank Jago is “probably the most innovative new product to watch,” CrossASEAN Research founder Angus Mackintosh tells Tech in Asia.

GoPay Tabungan, which was introduced in October, functions as a bank account for daily transactions that can be accessed directly via the GoPay and Gojek apps. According to GoTo, it drew 200,000 users and more than 1 million transactions in two weeks.

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