Initially, Grab’s payment service will have zero MDR, according to Tan. That means merchants who accept payments via GrabPay will be able to add the full amount to their topline.
“We want to make sure that merchants firstly understand what the product is, how it helps them and there’s zero cost to try,” said Tan.
But once the service picks up more users, she added, the plan is to determine a reasonable MDR that will not become “prohibitive for anybody.”
The way the transactions will work is this:
- Inside the Grab app, users tap on the GrabPay button
- They will scan the QR code displayed at the store, key in the amount due and slide the navigation bar to complete the payment
- Both the buyer and the seller are then notified of the completed transaction through the Grab app
Users can top-up the mobile wallet using GrabPay Credits, credit and debit cards, other forms of digital payments such as Alibaba’s Alipay, Android pay and mandiri-ecash which is popular in Indonesia.
Earlier this year, Grab said it expected to raise $2.5 billion in fresh funds from China’s Didi Chuxing, Japan’s SoftBank Group and others to bolster dominance in the region and grow its mobile payments business.
Currently, the company has over 63 million app downloads, including 4 million in Singapore, and is available in 132 cities across Southeast Asia. The company told CNBC it expects to register it’s one billionth ride transaction this week.
The company is profitable in some of the more developed markets and services, according to Tan, but she did not disclose specifics. “In others, especially like payments, with the launch today, we’re actively, heavily investing,” she said.
Tan also told CNBC that Grab has no plans to currently expand beyond Southeast Asia because the market has plenty of potential.
“I think as of right now, our focus, as it has been for the past five or so years, is Southeast Asia,” she said. “There’s so much value and potential there, we don’t really see any need to go elsewhere because we don’t want to get distracted.”