Grab Holdings Ltd.’s upstart digital bank 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 Wednesday that customers can now each deposit up to S$75,000 ($57,000) into a savings account. The limit previously was S$5,000.
The change signals that the Monetary Authority of Singapore has raised the deposit cap of S$50 million it had placed on the digital bank backed by Grab. That would be a boon for GXS’s 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.
Read more: Grab, Sea Push Singapore to Lift Digital Banks’ Deposit Cap
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$1 billion of deposits.
Read more: Cap Lift May Let Grab, Sea Digibanks Catch Up to Trust: React
An easing of the deposit cap could help the digibanks to boost scale and approach break-even. As they applied for their licenses, 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 license 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.
--With assistance from Chanyaporn Chanjaroen.
(Updates with change in customer criteria in seventh paragraph)
