SINGAPORE (Nikkei Markets) -- Banking giant DBS Group Holdings and smaller lender United Overseas Bank have joined forces with rival ride-hailing apps, intensifying competition in the regional payments space even as technology companies make inroads.
DBS and Indonesia's Go-Jek said on Monday they would work together on payment services ahead of Go-Jek's arrival in Singapore. The strategic alliance will soon extend to other countries in Southeast Asia, they added.
Separately, UOB, the smallest of Singapore's three main lenders, announced a tie-up with Grab that will let the bank provide financial services to the Singapore-based ride-hailing company's tens of millions of customers across Southeast Asia.
In return, Grab will be able to use UOB's payment systems in its app and tap the lender as a credit card partner in Singapore, Indonesia, Malaysia, Thailand and Vietnam.
"The deal will enable UOB to deliver financial services to Grab's ASEAN-wide user base and to accelerate the bank's efforts to meet the needs of the region's fast-growing 'mobile-first' and 'mobile-only' consumers," UOB said in a statement.
ASEAN, or the Association of Southeast Asian Nations, a 10-country grouping that includes Singapore, Malaysia, Thailand, Indonesia, the Philippines, and Vietnam, is fast emerging as a battle ground for banks and other service providers as they aim for a larger share of mobile-savvy customers.
Singapore-based lenders and credit card companies are also facing growing competition at home as they contend with rival payment systems from tech giants such as Google and Apple as well as regional players like Singapore Telecommunications.
Earlier Monday, Razer, the Hong Kong-listed gaming hardware firm, said its Razer Pay mobile wallet could soon be accepted at some 40,000 point-of-sale terminals in Singapore under a partnership with NETS Group, the operator of a system that allows payments by bank cards.
For UOB, the Grab deal represents an effort to reach out to the millions of "unbanked" customers in Southeast Asia who will need digital wallets and payment systems to transact electronically.
UOB is also working to embed features of its upcoming Digital Bank within Grab's mobile app, enabling users to access banking services quickly and conveniently, the bank said.
Grab, Southeast Asia's most valuable start-up with an estimated valuation of $10 billion, is the biggest ride-hailing company in several countries including Singapore, Malaysia, Thailand and Vietnam. The company claims over 125 million downloads of its app and has since diversified into food delivery, payments and the sale of vehicle insurance.
Go-Jek is the dominant ride-hailing company in Indonesia, where it also offers food delivery, logistics and other on-demand services. The company, whose investors include Google, Singapore's Temasek Holdings, and China's Tencent Holdings and Meituan Dianping, is looking to expand regionally and recently launched its service in Vietnam.
The Indonesian company plans to launch a beta, or trial, version of its ride-hailing app in Singapore in coming weeks with DBS offering incentives to prospective customers in the city-state.