Earned Wage Access Platforms (EWA) that allow workers to withdraw their earnings on demand instead of waiting for payday are growing around the world. Today, the Indonesian startup EWA employee announced that it has raised $ 5.6 million in strategic funding, led by Integra Partners (formerly Dymon Asia Ventures). Other investors included Asian Development Bank (ADB) Ventures, PT Triputra Investindo Arya, Global Founders Capital, Trihill Capital, 1982 Ventures and Willy Swandi Dharma, former CEO of insurance company PT Asuransi Adira Dinamika.
Founded in 2020 by alumni of two of Southeast Asia’s biggest tech companies, it hopes to reach more than 250,000 users this year. Managing Director Tobias Fischer was the former Regional Lending Program Director at Grab Financial Services Asia, while CTO Sasanadi Rukua was Vice President of Engineering at Tokopedia.
Fischer told TechCrunch that after working at financial services companies in Southeast Asia, he and Ruka found that “managing cash flow is the most pressing daily problem for low-income Indonesians and intermediate”.
As the pandemic has exacerbated financial difficulties, Fischer said more than 75% of Indonesians were already struggling to cover unforeseen expenses between paychecks. Many borrow from family or friends, but if that option is not available, they can turn to payday lenders who can charge more than 360% annualized percentage rates, or pay overdraft and overdraft fees. delay at their banks until their next paycheck.
“This is the start of a vicious and costly debt cycle that has a lasting negative impact on individual financial well-being, which in turn impacts companies with higher turnover, lower productivity and more employee loans, ”Fischer said.
On average, more than 50% of employees at Salaire client companies use it multiple times during the month to track their daily income and access their salaries. The ultimate goal of the company is to “create a holistic platform of financial well-being for low and middle income workers” that includes other financial services including savings, insurance and of smart spending, Fischer said.
More and more companies around the world allow workers to choose when they are paid. Some notable EWA platforms include Gusto Cashout; DailyPay, which recently achieved unicorn status; Salary ; Minu and even. In Indonesia, Waily’s competitors are GajiGesa and Gajiku.
Fischer said wages “created the category of access to wages earned in Indonesia” and that he is the market leader with more than 50 large companies, including state-owned enterprises and multinational conglomerates. His new funding will be used to increase Salaire’s sales team to close more deals with the company. Current Wagely customers include PT Bentoel Internasional Investama Tbk (British American Tobacco); PT Supra Boga Lestari Tbk (ranch market); the beauty and wellness company PT Mustika Ratu Tbk; and the renewable energy group PT Kencana Energi Lestari Tbk.
In a press release, Wilson Maknawi, CEO of PT Kencana Energi Lestari TBK, said: “Provides our employees with financial stability in times of uncertainty. This is extremely important and a crucial step for the long term resilience of our business. Without any changes to our payroll process, Salary’s solution has been shown to increase our company’s savings and help our employees avoid predatory loans while providing savings and budget tools that increase their financial literacy. .