Grab, Southeast Asia’s largest ride-hailing and payment company said that they had put a hold on the partnership with scandal-hit Wirecard. The news follows days after the German payments firm disclosed a $2.1 billion financial hole and has been in a downwards spiral, since. The arrest of its CEO has further jeopardized its future.
On Wednesday, to respond to the status of the partnership their partnership with Wirecard, Grab’s spokeswoman told Reuters “We have not begun business integration work on the Wirecard partnership and we are pausing the partnership till further notice.”
In March, the two companies had successfully struck a payments agreement. Under this agreement, Wirecard was to going to process all the transactions made via the GrabPay e-wallet for Grab. The company was going to start with the markets in the Philippines, Malaysia, and Singapore.
The company had yet not started signing up merchants or processing payments for Grab as per the agreement. The Southeast Asian start-up’s e-wallet accepts payment from more than 600,000 regional small businesses and merchants. On Tuesday, the Monetary Authority of Singapore, while responding to a query, said that they have asked Wirecard to ensure that it will keep customer funds in the country’s banks from its local activities.
This week, the former boss of Wirecard was arrested on suspicion of falsifying accounts. The even followed the payments firm disclosing its financial hole and questioning if its trustees had held money.
The financial regulator in Germany has also filed a fresh complaint against the company. They have said that the admission that billions were missing showed that they have misstated its financial position between in years 2016 and 2018.