- Grab discontinues GrabPay Mastercard, shifting focus to its GXS Bank’s payment solutions.
- Eliminating overlaps boosts GXS profitability via lower transaction costs.
- Strategic alignment positions GXS as pivotal in Grab’s ecosystem for mutual growth.
Grab’s recent decision to discontinue its GrabPay Mastercard from June 1 triggered speculation about profitability concerns.
However, this move might signify Grab’s push towards utilization of GXS Bank’s payment solutions. Considering GrabPay’s roots as a loyalty ecosystem, channeling transactions through GXS Bank aligns with Grab’s long-term strategy.
Spring cleaning, Grab-style!
Grab’s retreat from services like GrabPay Card and AutoInvest signals a conscious effort to eliminate overlaps with GXS Bank’s offerings.
By funneling payment usage through the digital bank, Grab aims to leverage lower transaction costs, boosting GXS Bank’s path to profitability. GXS Bank actively incentivizes account usage by offering attractive interest rates on main accounts, reaching up to 2.68% with qualifying transactions.
This strategic move, coupled with plans to increase loan disbursals, strengthens GXS Bank’s profitability prospects and supports its case for higher deposit caps from regulators.
Two peas in a pod, but one’s a bank
As GrabPay retreats from overlapping services, GXS Bank stands to reap the benefits of increased transaction volume and customer utilization.
This strategic alignment positions GXS Bank as a pivotal player in Grab’s ecosystem, fostering a symbiotic relationship that drives growth and profitability for both entities.
To read the original article: https://www.techinasia.com/grabpays-retreat-gxs-banks-gain
