GXS Bank said customers could each deposit up to S$75,000 (US$57,000 or RM258,922) into a savings account. The limit previously was S$5,000 (RM17,122). — Reuters
SINGAPORE: Grab Holdings Ltd’s upstart digital bank has started accepting larger deposits in Singapore, suggesting the city-state’s regulator has raised the limit it had previously placed on the company.
GXS Bank, the digibank joint venture of Grab and Singapore Telecommunications Ltd, said customers could each deposit up to S$75,000 (US$57,000 or RM258,922) into a savings account. The limit previously was S$5,000 (RM17,122).
The change signalled that the Monetary Authority of Singapore (MAS) had raised the deposit cap of S$50mil (RM171.22mil) it had placed on the digital bank backed by Grab. That would be a boon for GXS’ push to compete with traditional lenders in the wealthy city-state.
Singapore’s new digital banks backed by Grab and Sea Ltd have been pushing the country’s central bank to lift restrictions that they see as curbing their lending ability. The tech companies are expanding to financial services to fuel growth beyond businesses such as online retailing and ride-hailing.
The MAS has said the deposit cap during the lenders’ first two years of operation is meant to safeguard consumers’ interests.
Still, digital rival Trust Bank, which doesn’t have deposit limits because it is backed by traditional lender Standard Chartered Plc, has raked in more than S$1bil (RM3.42bil) of deposits.
An easing of the deposit cap could help the digibanks to boost scale and approach break-even. As they applied for their licences, they had to show a path toward profitability within five years.
Grab’s digital bank was set up just under a year ago and had accepted savings account customers on an invitation-only basis. It is now removing that condition, accepting “all eligible individuals” as customers, it said in a statement.
Sea’s MariBank, the only other holder of a digital full bank licence in Singapore, started deposit-taking with its employees last year and has since expanded to lending to businesses. Its offerings are on an invite-only basis for users of Sea’s Shopee marketplace app. — Bloomberg
