FinTech news in earned wage access category

Despite concerns that the EWA technology is replicable, Aris Xenofontos, partner at Seaya, is of the belief that EWA is a defensible business model because the moving parts are complex enough to deter corporations from coming up with their own solutions. For accounts that start on an employee-pays model, employers will get a better understanding of how EWA improves employee productivity and retention over time. What we’ve found is that EWA startups typically service a mix of customers across both models, where the employer pays in some cases and the employee pays in others. Despite a few different EWA models seeing varying success at the moment, Ho believes the model that places the cost on the employer is the one that will win.

Users aren’t under a legal obligation to repay ZayZoon and ZayZoon won’t take action to collect payments, but nonpaying users will be limited from accessing the service in the future. ZayZoon’s platform allows small- and medium-sized businesses to implement what’s known as an earned wage access (EWA) program.

In the future, Salary Hero plans to add neo banking products, including at-source savings accounts, insurance products, remittances and other financial services like micro-investments and debt restructuring advice. Rakhra said that by addressing the financial needs of their workers, companies are able to improve employee satisfaction and reduce turnover in a competitive labor market. These other products will go live in 2023, while Salary Hero earned wage access and financial education features are already live. By being able to access their earned wages on demand, workers are able to better handle emergencies and unforeseen expenses, instead of being forced to borrow from lenders who charge 10% to 30% interest per month, Rahkra said.

Khazna plans to launch additional products before the end of the year; this product expansion and user growth is what Saleh points out when asked how Khazna stays ahead of the competition. The company, founded by Omar Saleh, Ahmed Wagueeh, Fatma El Shenawy, and Omar Salah in 2019, provides basic banking and various financial services focusing on middle and lower-income earners. In a country where 50% of its 100 million people are active smartphone users, two out of every three individuals have little or no access to formal financial services in Egypt.

Earnipay, a fintech that provides flexible and on-demand salary access to income-earners, has raised $4 million in seed financing led by early-stage venture capital firm Canaan.

Pinwheel is also the only company providing direct deposit switching and payroll data that is classified as a Consumer Reporting Agency (CRA) in compliance with the Fair Credit Reporting Act, meaning that if consumers are adversely affected by Pinwheel’s data, the company would be legally accountable.

Refyne has raised a new financing round, just seven months after securing its previous funding, as the Bengaluru-based startup scales its platform that helps workers access their earned salaries in real time.