26-9-2023 (SINGAPORE) Grab is discontinuing its retail investment products and services in Singapore, citing commercial viability concerns following a review of the GrabInvest business. The ride-hailing giant informed customers through email that its two investment products, AutoInvest and Earn+, will be terminated, and it won’t accept new deposits.
Customers have until October 13 to withdraw their funds from these products. Afterward, accounts will be closed, and further transactions will not be possible.
Grab entered the retail wealth management sector in 2020 after acquiring Bento Invest, a Singapore-based robo-advisory startup. AutoInvest, its first investment product, allows users to invest with transactions as low as S$1, primarily in money market and short-term fixed income mutual funds, offering returns of up to 1.18 percent per annum.
In May of the following year, Grab launched Earn+ as a “low-risk” way for users to invest in institutional funds and earn higher returns of 2 to 2.5 percent per annum on idle cash.
In response to CNA’s inquiries, Grab explained that they are winding down GrabInvest and its associated products due to a lack of investment in scaling the business. They found it to be commercially unviable in the long run.
Grab’s decision to exit the retail wealth management space is similar to that of Moneyowl, which recently announced its closure by the end of the year. MoneyOwl cited a review that found the business unviable.
Grab noted in an email to customers that discontinuing the investment offerings may lead to an earlier redemption of fund units held by customers. In such cases resulting in negative returns, Grab will credit the equivalent value to customers’ GrabPay Wallets as a goodwill gesture.
The exit from retail investment services comes as Grab, Southeast Asia’s largest ride-hailing and food delivery firm, is striving to become profitable and regain investor confidence. It is narrowing losses after significant cost-cutting measures and job layoffs.
Grab is now aiming to reach an adjusted core earnings breakeven in the current quarter, ahead of its earlier target for the fourth quarter.
