Grab Vietnam added e-wallet ZaloPay to its ride-hailing app, marrying two of the Southeast Asian country’s most popular platforms in the latest example of concentration in the fast-growing technology sector.
The two startups aim “to gain access to large consumer bases of each other,” said a statement on Monday from VNG, the parent of Zalo and a contender to be Vietnam’s only listed company in the US. Vietnamese are able to pay for Grab rides and delivery with Zalo in an echo of last year’s partnership between Indonesian ride-hailing rival Gojek and Vietnam’s biggest e-wallet, MoMo.
RELATED ARTICLE
As the tech firms jockey for dominance in the communist country of 100 million people, the tie-ups offer a chance to bring more users into their ecosystems. They also raise questions about potential concentration in superapps, with Grab Vietnam—a unit of Singapore-based Grab—leading the ride-hailing market and offering other services like hotel bookings. Zalo’s messenger service is the most popular in Vietnam and is linked to an even bigger range of features, like utility payments, while also enabling food delivery via South Korea’s Baemin.
“By leveraging human and technological resources of both parties, we will realize our ideas and launch new practical products,” said Le Lan Chi, chief operation officer of ZaloPay.
Her parent company, the unicorn VNG, made its name in digital games and is considering an initial public offering on Nasdaq. “No comment,” VNG co-founder Le Hong Minh told Nikkei Asia last month when asked if the IPO may come in 2023.
Ride-hailing has struggled in Vietnam in the past year, with drivers unhappy about fuel prices, the lack of a safety net, and missing payments on car loans, in some cases, because of a pandemic economic crunch. Customers reported shortages after many drivers moved back to their rural hometowns to escape COVID.
Grab also has an e-wallet called Moca and signed a cross-promotional deal with e-commerce company Lazada in Vietnam in 2020. It does not disclose user numbers, though Statista says it serves more than 70% of Vietnam’s nearly 20 million ride hailers. Zalo has 10 million pay users and more than 70 million chat users, most of which likely overlap.
Grab Vietnam Deputy Head Nguyen Thi My Hanh said it is “sharing financial and technological capabilities and insights into user experience” with Zalo.
This article first appeared on Nikkei Asia. It has been republished here as part of 36Kr’s ongoing partnership with Nikkei.