Grab, Sea see loan books surge in Q2 as financial services drive growth

[SINGAPORE] Financial services is emerging as an increasingly important growth engine for South-east Asia tech giants Grab and Sea, with surging loan growth driving a bigger contribution to earnings in the second quarter.

Grab’s gross loan portfolio jumped 197 per cent year on year to US$2.3 billion in Q2 from US$781 million.

Part of this growth was due to the consolidation of Superbank within GrabFin, Grab’s financial services arm. However, without Superbank’s contribution, the gross loan portfolio still doubled year on year.

The non-performing loan (NPL) ratio was not disclosed.

Analysts have noted that Grab’s financial services segment is approaching profitability. Adjusted earnings before interest, taxes, depreciation and amortisation (Ebitda) is expected to turn positive in the second half of 2026, Grab’s senior management said during its results briefing.

Financial services was the company’s fastest-growing segment, said Phillips Securities analyst Helena Wang in a research report, with revenue rising 59 per cent to US$134 million in Q2, from US$84 million a year ago.

“The consolidation of Superbank and acquisition of wealth platform Stash should further broaden Grab’s financial ecosystem while creating additional cross-selling opportunities across its existing user base,” she said.

The consolidation of Superbank and Stash into Grab should narrow adjusted Ebitda losses, noted Jacquelyn Yow, analyst at CGS International. The Superbank consolidation also boosted Grab’s loan book by 61 per cent quarter on quarter.

Grab’s financial services segment reaching break-even would be the next catalyst for the company, and Yow believes it is achievable with contributions from Superbank and Stash.

“We expect significant margin expansion ahead, as Superbank and Stash generate adjusted Ebitda to revenue margins of between 15 and 20 per cent,” said Yow.

Wang Kai, senior equity analyst at Morningstar, believes the fintech business will be the next long-term catalyst for Grab. It is starting to contribute to a larger part of the company’s valuation, he noted.

“We don’t expect any challenges on the horizon as its loan book grew 227 per cent year on year last quarter, unless it starts to see credit deterioration from its borrowers,” said Wang.

While the business is expected to be profitable this year and aggressively scale up long term, the long-term margin profile remains uncertain. Grab’s management remains optimistic about the ceiling for the financial services business, said Wang.

Profitability for the financial services segment will hinge on loan book growth, he said, as well as lack of delinquent loans. An increase in NPLs will dent profitability of the segment.

“Theres no visibility on how big the loan book can grow but we expect it to increase at least 50 per cent year on year next quarter,” said Wang.

Monee’s loan book tops US$11 billion

At Sea’s financial services arm, Monee, loans grew 62.5 per cent to hit US$11.1 billion as at Jun 30, 2026. The loan portfolio consisted of US$10 billion on-book loans and US$1.1 billion off-book loans.

Across the markets that Sea operates in, the Philippines has become the fifth market where its loan book exceeds US$1 billion. The NPL ratio for Monee stood at 1 per cent in Q2 2026.

The continued loan growth and low NPL ratio gives confidence in Monee’s potential to scale earnings, said CGS’ Yow.

The stronger-than-expected loan book growth remains a re-rating catalyst for Sea, along with better Shopee margins and continued momentum at gaming business Garena, she added.

Monee is also increasing its loan portfolio beyond the Shopee ecosystem, which accounted for more than 20 per cent of its SPayLater portfolio as at June 2026, she said.

“We expect earnings momentum to accelerate in (H2 2026) as Shopee’s margin expansion becomes more visible, Monee continues to scale, and Garena’s content pipeline strengthens,” said Yow.

Monee is emerging as a key driver of incremental profitability for Sea, she noted, and could match or surpass Shopee’s adjusted Ebitda contribution over the longer term.

Artificial intelligence is also making an impact at Monee, noted Sachin Mittal, analyst at DBS Group Research. Underwriting driven by AI has lifted approval rates by about 10 per cent while maintaining a similar risk level.

“AI tools for verifying income documents reduced review time by about 95 per cent, allowing near-instant responses to credit-limit requests,” said Mittal in a report.

There is still headroom for Monee to grow in the underbanked markets that Sea serves, noted Chelsey Tam, senior equity analyst at Morningstar.

Changes in the product and country mix may have led to higher provisions and lower margins at Monee, but underlying credit risk is stable, she noted.

Some of its success stems from granting small short-tenor loans via its buy-now-pay-later service to build a repayment history. A better understanding of users will allow Monee to grant them bigger loans, Tam added.

There might be fluctuations in the loan margins depending on the changes in country and product mix, but risk remains stable, she added.

Monee’s loan book should continue to expand rapidly as financial services move off Shopee in Brazil, Thailand and Malaysia.

Still, financial services is unlikely to dethrone e-commerce as Sea’s biggest revenue contributor any time soon.

It should remain the dominant contributor for the next 10 years, said Tam.