Article

Public Value through Private Partnerships: The Grab Story

A five-year-old technology platform is harnessing public, corporate and individual partnerships to transform urban Southeast Asia.

Public Value through Private Partnerships: The Grab Story

Date Posted

11 Jan 2018

Issue

Issue 18, 30 Jan 2018

Public Value through Private Partnerships: The Grab Story from Civil Service College Singapore on Vimeo.


About Grab

Founded in 2012, Grab is Southeast Asia’s leading on-demand transportation and mobile payments platform.

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Solving Real Problems through Its Social Mission

Grab’s vision is to drive Southeast Asia transportation forward and transform the region’s mobile internet ecosystem. Our social mission in transport is to provide safe, reliable and accessible transportation options to connect people to places where they work, live and play. Grab uses technology to improve the efficiency and cost-effectiveness of these options, offering viable alternatives that can encourage people to give up their cars, contributing to Singapore’s car-lite vision.

With its advanced digital infrastructure and ambition of becoming a Smart Nation, Singapore has provided a good testbed for experimenting with new multi-modal transportation solutions and payments platforms.

All Grab products and features are planned and managed out of the Singapore R&D centre, which is the largest of our six R&D centres (the other five centres are located in Beijing, Bangalore, Jakarta, Ho Chi Minh City and Seattle).

 

Providing Transport Options for All Budgets

Since entering the Singapore market, Grab has worked with the government to apply technology to provide affordable, safe and convenient commuting options. Such options maximise the use of each vehicle to get people from point to point, and complement Singapore’s public transportation system by serving the first and last mile journeys of commuters. For example, Grab launched the GrabShuttle service in March 2017 (in partnership with GovTech in Singapore) to serve relatively inaccessible areas, such as Tuas, Changi industrial estates, and Sengkang–Punggol, with more direct routes, and at a lower price point.


Plugging the Cashless Payments Gap

Grab is now focusing on solving the next big, meaningful tech problem in Southeast Asia: to make cashless transactions possible for everyone. Grab already has a substantive base of transport users who use our app to book—and pay for—their daily commutes. Southeast Asia is still a largely cash-based transaction economy. A large proportion of the region’s 620 million people remain unbanked, with the World Bank noting that only 27% have a bank account, while only 9% of adults have a credit card.

A study commissioned last year by the Monetary Authority of Singapore (MAS) and conducted by business consultancy KPMG showed that in Singapore, cash formed more than 80% of payments at small shops and neighbourhood stores, and about 90% at hawker centres and wet markets.

Grab first launched GrabPay Credits in November 2016, allowing everyone in Singapore with the Grab mobile app to make payments for rides taken through a cashless stored value option. Today, GrabPay has expanded beyond the realm of transportation. Users—beginning with those in Singapore—can transfer money to one another, and use GrabPay as an e-wallet to pay for food and services in hawker stalls, restaurants and shops. We are focused on helping cash-based businesses in Singapore go cashless, giving them access to new customers in an easy and affordable way.

With Singapore as a testbed, we look to work with public and private sector organisations to scale the GrabPay e-wallet across Southeast Asia in 2018. 

Creating Public Value through Partnerships

As our portfolio of operating locations and services grows, Grab continues to prioritise community welfare—going beyond drivers and passengers to helping governments and local communities at large. Grab’s approach is collaborative: for example, helping governments think about how ride-hailing regulations should come into effect, based on what the local infrastructure needs are. In turn, governments appreciate that we are aligned to their policy agendas and that we work together to provide long-term solutions.

One example of this is our contribution to the World Bank’s OpenTraffic initiative in Manila, Cebu and Kuala Lumpur.

Supporting Local Communities

Besides providing a safe, convenient and accessible transportation platform for Grab users and ensuring Grab driver-partners continue to earn sustainable incomes, we constantly look for opportunities to contribute back to local communities in the markets where we operate.

When a study in Manila indicated that Grab driver-partners remitted their earnings to their partners, and that nine out of every 10 housewives were ill-equipped to manage the money remitted by their Grab driver-husbands, Grab Philippines launched Grab Academy for them. The goal: empowering and educating the wives to manage their husbands’ income well, and at the same time enabling them to start their own  businesses.

Over 1,000 housewives of our driver-partners attended the one-day Grab Wives Academy programme, organised in partnership with Unionbank, Lendr, Avon, Sunlife, Angat Pilipinas, and Generika Drugstore. Thereafter, hundreds of housewives are now direct sellers for Avon and are actively contributing to their household income.

Across the region, Grab drivers earn 35% more than the average wages—most of which is spent on supporting their families and sending their children to school. Grab’s driver-partners in Singapore are entitled to exclusive fuel discounts to keep costs low, a free Personal Accident Insurance plan for greater peace of mind, and Medisave contributions to save up for future medical needs.

To supplement the education of their driver-partners’ children, Grab launched GrabSchool—an enrichment workshop to develop entrepreneurship and innovation skills. Over 1,000 children have benefited from this. Going a step further—in Vietnam—Grab also granted 35 scholarships, and donated gifts and cash for underprivileged people amounting to VND 140 million in 2017.

To improve road safety1 with better vision,2 Grab partnered with Essilor in 2017 to provide driver-partners in the region with free eye-screening and access to quality low-cost eyewear. For example, a vision booth was set up in Grab’s Driver Centres in Yangon and Jakarta, where hundreds of drivers have had their eyes screened and are now equipped with quality spectacles for improved vision.

Grab also uses technology to correct driving behaviour of their driver-partners. In Singapore for example, the use of telematics has improved driving behaviour by nearly 35%. In-car cameras are also installed and distributed at a subsidy to Grab-driver partners in Malaysia, and drivers are trained on emergency skills including first aid, CPR and AED.

SHARING TRAFFIC DATA TO AID PLANNING

OpenTraffic provides traffic management agencies and city planners with access to open datasets so they can better manage traffic flow, make investment decisions on local transport infrastructure, and take a more data-driven approach to urban planning.

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DIGITISATION: TRANSFORMING LIVELIHOODS

Grab drivers are “partners”: not workers nor contractors.

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Regulators Can Create a Conducive Environment for Innovation

The Singapore government has been helpful in providing space for initiatives to be launched, without rushing to impose regulations at the onset. For example, when Private Hire Cars (PHCs) were launched in Singapore, the government did not ban or regulate it outright, unlike what was done in some cities in other countries. Instead, they adopted a wait-and-see approach. They gave time for these developments to play out, so their effects could be fully analysed. A similar approach was taken by MAS with its regulatory sandbox for Fintech innovation, which was helpful when GrabPay—Grab’s proprietary payments platform—was being developed to facilitate cashless payments.


Lack of regulation does not mean no oversight. When regulators engage closely with private players, it provides opportunities for discussion around issues of concern.

It helps when regulators are more open to engaging closely with industry players. Partnership is a two-way process: it allows industry to be sensitised to public considerations (e.g., safety in the private car hire sector) while allowing local governments to understand the rationale behind seemingly controversial initiatives that private players may push.

Lack of regulation does not mean no oversight. When regulators engage closely with private players, it provides opportunities for discussion around issues of concern. At Grab, we welcome these opportunities to work collaboratively with regulators to solve problems together. A good example of this in action was when LTA opened the PDVL application process for PHC drivers. Grab provided inputs on what they could do collectively to design a smooth process for their driver-partners. Similarly, they are now engaging more closely with MAS on plans for GrabPay, to ensure that they can meet all relevant regulatory requirements to create a safe and secure payments system that will ultimately result in building deeper consumer trust.

The new digital economy thrives on timely, accurate and meaningful information. With the right use of technology, availability and applicability of good data and effective partnerships in place, we can go about our daily lives with greater ease, comfort and convenience—and everyone benefits. This should be our shared goal: working together across sectors to ensure that the needs of people are well taken care of and creating shared value. Grab is committed to help make this happen in Southeast Asia’s dynamic cities.


ABOUT THE AUTHOR

Zafrul Hashim is Regional Legal and Public Affairs Head at Grab.


NOTES

  1. According to the 2006 World Health Organisation report, poor eyesight of road users is the main risk factor for road accidents.
  2. Boston Consulting Group has found that 36% of Asian drivers have uncorrected vision.

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