Singapore’s Grab puts partnership with troubled Wirecard on hold

Grab and Wirecard struck a payments agreement in March under which the German payments firm was to process transactions made via the GrabPay e-wallet. (AFP file photo)
Short Url
Updated 24 June 2020

Singapore’s Grab puts partnership with troubled Wirecard on hold

  • The two companies had struck a payments agreement in March
  • Wirecard had not begun processing payments or signing up merchants on behalf of Grab

SINGAPORE: Southeast Asian ride-hailing and payments company Grab said it had put a partnership with scandal-hit Wirecard on hold, days after the German payments firm disclosed a $2.1 billion financial hole that threatens its future.
“We have not begun business integration work on the Wirecard partnership and we are pausing the partnership till further notice,” a spokeswoman from Grab said on Wednesday in response to a query about the status of the partnership.
The two companies had struck a payments agreement in March under which Wirecard was to process transactions made via the GrabPay e-wallet, starting with markets in Malaysia, Philippines and Singapore.
Wirecard had not begun processing payments or signing up merchants on behalf of Grab, Southeast Asia’s most valuable start-up, whose e-wallet is accepted by more than 600,000 merchants and small businesses in the region.
Responding to a query, the Monetary Authority of Singapore said on Tuesday that it had asked Wirecard to ensure that it keeps customer funds from its local activities in the country’s banks.
This week, Wirecard’s former boss was arrested on suspicion of falsifying its accounts, after the payments firm disclosed the financial hole and questioned whether trustees had actually held money on its behalf.
Germany’s financial regulator also filed a fresh complaint against Wirecard with the prosecutor, saying the company’s belated admission that billions were missing showed it had mis-stated its financial position between 2016 and 2018.


Decreasing purchasing power pushes Turks toward ‘Syrian gold’

An employee displays gold bars at a Korea Gold Exchange shop in Seoul on July 30, 2020. Virus uncertainty combined with China-US tensions has sent gold soaring nearly 30 percent this year. (AFP)
Updated 14 min 36 sec ago

Decreasing purchasing power pushes Turks toward ‘Syrian gold’

  • Economist Umit Kumcuoglu said the increasing use of lower-alloy “Syrian gold” mainly derives from the need to preserve status and tradition, and would not produce a significant impact on the local economy because it was not a counterfeit product

ANKARA: The escalating price of gold in Turkey, in tandem with the global market and the decrease of purchasing power, has led to an influx of lower quality products from Syria.
One, an imitation known as “Syrian gold” due to its popularity with Syrian jewelers, has gone mainstream, having emanated from the jewelry markets of the southern city of Hatay on the Syrian border.
One gram of gold currently costs 437 lira ($62) in Turkey, up by almost two-fifths since January. Having reached near unaffordable levels, the prices have pushed people to turn toward metals with lower values for things such as wedding ceremonies, where pinning 22-karat gold coins and sets of gold jewelry on couples is a Turkish tradition.
Economist Umit Kumcuoglu said the increasing use of lower-alloy “Syrian gold” mainly derives from the need to preserve status and tradition, and would not produce a significant impact on the local economy because it was not a counterfeit product.
“In southeastern tribes, buying gold for wedding ceremonies is an established tradition, and people are inclined to continue this practice amid decreasing purchasing power due to the coronavirus disease outbreak and devaluation conditions in the country,” he told Arab News.
However, according to Kumcuoglu, the ongoing economic challenges, and especially skyrocketing inflation, could push some people to produce counterfeit gold in the future.
Turkey’s central bank became the world’s biggest official-sector buyer of gold in June, according to International Monetary Fund figures. In a bid to support the Turkish lira amid currency concerns, the bank increased its reserves by 890,000 ounces to a record level of 21.28 million in May.
As per the figures published by the World Gold Council, total central bank gold purchases were 139 tons in the first four months of 2020, with the lion’s share of these, 111 tons, coming from Turkey.