Ovo’s future at stake as Grab pushes Superbank in Indonesia

Two’s company, three’s a crowd.

Grab recently integrated the digital bank Superbank with its app in Indonesia. This lets users access Superbank’s offerings directly on the Grab app.

This means that Ovo – the e-wallet that Grab has a 90% stake in – will have to compete against the digital bank for transaction volume in Grab’s platform.

This raises concerns about Ovo’s position in Indonesia’s increasingly crowded e-wallet segment. According to SensorTower data, the daily download numbers for the Ovo app in the country lag behind Dana, ShopeePay, and GoPay throughout August.

As an e-wallet, Ovo needs more transactions to generate more revenue. With its sibling Superbank now integrated with the Grab app, will this have a negative impact on its prospects?

Ovo cannibalized

Superbank, formerly known as Bank Fama International, is a digital bank owned by Grab, Emtek, Singtel, and KakaoBank. Within two months of its launch in Indonesia, the platform reached 1 million users.

Notably, 62% of Superbank users have linked their accounts to the Grab app, according to the digital bank.

However, that number is still tiny compared to Ovo. In May 2021, the e-wallet’s monthly active users reached 20.8 million, according to a report from Momentum Works.

Image credit: Timmy Loen

Like other digital banks, Superbank is aggressively offering promotions to attract consumers during its initial launch. Its deposit products, for example, offer interest rates of up to 7.5% per year – higher than Sea Group’s SeaBank at 6% and Bank Jago at 5.25%.

Grab has also been encouraging its users to open Superbank accounts and transact with the digital bank. During its initial launch, Grab offered promotions such as a 75% discount for payments using Superbank on GrabFood and GrabBike.

See also: Are Grab’s and GoTo’s fintech strategies diverging?

Industry analysts agree that Grab’s move to promote Superbank on its platform will “cannibalize” Ovo’s transaction volume.

Dual-role playbook

Fintech war