wagely bags US$5.6M to give Indonesia’s low-paid workers access to their earned wages

[L-R] wagely co-founders Tobias Fischer (CEO), Sasanadi Ruka (CTO), and Kevin Hausburg (CCO)

[L-R] wagely co-founders Tobias Fischer (CEO), Sasanadi Ruka (CTO), and Kevin Hausburg (CCO)

wagely, a financial wellness platform that enables earned wage access (EWA) in Indonesia, has received US$5.6 million in a strategic round of investment, led by Integra Partners (formerly known as Dymon Asia Ventures).

Other participating investors include ADB Ventures, PT Triputra Investindo Arya (one of Indonesia’s largest privately held groups), Global Founders Capital, Trihill Capital, 1982 Ventures, and Willy Suwandi Dharma (former President Director of PT Asuransi Adira Dinamika).

Also Read: Impact-tech investor ADB Ventures in talks to raise US$100M debt fund

The Jakarta-headquartered startup will use the capital infusion to accelerate the adoption of its platform.

Founded by Tobias Fischer (previously with Grab) and Sasanadi Ruka (formerly with Tokopedia), wagely gives employees access to their earned wages and financial education.

How wagely works

EWA is a concept wherein an employee can withdraw a part of his/her already earned salary before the payday. This is aimed at reducing financial stress for millions of low- and middle-income workers, who struggle with unexpected financial expenses between pay checks.

EWA is roughly like paying an employee daily/weekly, which is impractical from an employer’s point of view. This is where wagely comes in as it allows employees to withdraw their earned wages through the app during emergencies.

When it is payday, wagely sends invoices to respective employers with the details on how much each employee has withdrawn.

For example, is an employee of a company has worked from June 1-10 while his payday is on the 25th. Then he can withdraw a part (say 50 per cent) of his prorated salary for the 10 days before his payday.

The startup generates revenue by charging a withdrawal fee from the employees. In some cases, employers themselves bear this fee.

wagely claims it serves tens of thousands of employees across many industries, including restaurants, factories, hospitals, and retail stores. Some of their partners are British American Tobacco, Ranch Market, PT Mustika Ratu, and PT Kencana Energi Lestari.

“More than 100 million Indonesian lower- and middle-income workers are living paycheck to paycheck and struggle with unexpected financial expenses between paychecks, which in turn impacts businesses with higher turnover, lower productivity, and more employee loans,” said CEO Fischer.

“Our workplaces are changing rapidly, especially since COVID-19 struck. Now the way people are getting paid is changing, too, and at scale. wagely provides a financial flexibility that is perfectly suited for today’s agile and progressive workforce,” he added.

“wagely offers our employees financial stability in times of uncertainty. It is incredibly important and a crucial step for the long-term resilience of our business,” said Wilson Maknawi, President Director at PT Kencana Energi Lestari.

“With no changes to our payroll process, wagely’s solution has proven to increase our business savings and helped our employees to avoid predatory loans while providing savings and budgeting tools that increase their financial literacy,” he shared.

As concerns over COVID-19 continue to grow, employers around the world, including Walmart, Pizza Hut and Visa, are turning to EWA solutions to reduce turnover, enhance productivity, and increase business savings.

Dailypay, a leading US-based EWA provider, just recently raised US$500 million and reached unicorn status.

Other noted EWA providers are US-based Payactiv, UK-based Wagestream, Mexican firm Minu, and US-based Even.

Payactiv already counts more than 2 million users and has processed more than US$5 billion in earned wage access, highlighting the tremendous potential of the space.

Also Read: 1982 Ventures partners with 3 Korean investors to help country’s startups enter SEA

Daniel Hersson, Senior Fund Manager at ADB Ventures, commented: “wagely offers workers what they did not have before: a fair and accessible financial tool to help them manage life’s inevitable contingencies and emergencies, including those caused by climate change.”

Over 70 per cent of the Southeast Asian adult population is still underbanked and lacking access to affordable and responsible financial services, while many of the 140 million low- and middle-income workers (72 per cent of the Indonesian workforce) who live from paycheck to paycheck are exposed to the cycle of debt caused by overdraft fees, high-interest credit, and payday loans.

Taking this opportunity, the earned wage access solutions offer a sustainable alternative to employees. With the COVID-19 pandemic and increased levels of financial stress that is directly impacting employers, wagely has become even more important to employees and employers and is well-positioned to further support millions of Southeast Asians with its holistic financial wellness platform.

Image Credit: wagely

The post wagely bags US$5.6M to give Indonesia’s low-paid workers access to their earned wages appeared first on e27.

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[L-R] wagely co-founders Tobias Fischer (CEO), Sasanadi Ruka (CTO), and Kevin Hausburg (CCO)

[L-R] wagely co-founders Tobias Fischer (CEO), Sasanadi Ruka (CTO), and Kevin Hausburg (CCO)

wagely, a financial wellness platform that enables earned wage access (EWA) in Indonesia, has received US$5.6 million in a strategic round of investment, led by Integra Partners (formerly known as Dymon Asia Ventures).

Other participating investors include ADB Ventures, PT Triputra Investindo Arya (one of Indonesia’s largest privately held groups), Global Founders Capital, Trihill Capital, 1982 Ventures, and Willy Suwandi Dharma (former President Director of PT Asuransi Adira Dinamika).

Also Read: Impact-tech investor ADB Ventures in talks to raise US$100M debt fund

The Jakarta-headquartered startup will use the capital infusion to accelerate the adoption of its platform.

Founded by Tobias Fischer (previously with Grab) and Sasanadi Ruka (formerly with Tokopedia), wagely gives employees access to their earned wages and financial education.

How wagely works

EWA is a concept wherein an employee can withdraw a part of his/her already earned salary before the payday. This is aimed at reducing financial stress for millions of low- and middle-income workers, who struggle with unexpected financial expenses between pay checks.

EWA is roughly like paying an employee daily/weekly, which is impractical from an employer’s point of view. This is where wagely comes in as it allows employees to withdraw their earned wages through the app during emergencies.

When it is payday, wagely sends invoices to respective employers with the details on how much each employee has withdrawn.

For example, is an employee of a company has worked from June 1-10 while his payday is on the 25th. Then he can withdraw a part (say 50 per cent) of his prorated salary for the 10 days before his payday.

The startup generates revenue by charging a withdrawal fee from the employees. In some cases, employers themselves bear this fee.

wagely claims it serves tens of thousands of employees across many industries, including restaurants, factories, hospitals, and retail stores. Some of their partners are British American Tobacco, Ranch Market, PT Mustika Ratu, and PT Kencana Energi Lestari.

“More than 100 million Indonesian lower- and middle-income workers are living paycheck to paycheck and struggle with unexpected financial expenses between paychecks, which in turn impacts businesses with higher turnover, lower productivity, and more employee loans,” said CEO Fischer.

“Our workplaces are changing rapidly, especially since COVID-19 struck. Now the way people are getting paid is changing, too, and at scale. wagely provides a financial flexibility that is perfectly suited for today’s agile and progressive workforce,” he added.

“wagely offers our employees financial stability in times of uncertainty. It is incredibly important and a crucial step for the long-term resilience of our business,” said Wilson Maknawi, President Director at PT Kencana Energi Lestari.

“With no changes to our payroll process, wagely’s solution has proven to increase our business savings and helped our employees to avoid predatory loans while providing savings and budgeting tools that increase their financial literacy,” he shared.

As concerns over COVID-19 continue to grow, employers around the world, including Walmart, Pizza Hut and Visa, are turning to EWA solutions to reduce turnover, enhance productivity, and increase business savings.

Dailypay, a leading US-based EWA provider, just recently raised US$500 million and reached unicorn status.

Other noted EWA providers are US-based Payactiv, UK-based Wagestream, Mexican firm Minu, and US-based Even.

Payactiv already counts more than 2 million users and has processed more than US$5 billion in earned wage access, highlighting the tremendous potential of the space.

Also Read: 1982 Ventures partners with 3 Korean investors to help country’s startups enter SEA

Daniel Hersson, Senior Fund Manager at ADB Ventures, commented: “wagely offers workers what they did not have before: a fair and accessible financial tool to help them manage life’s inevitable contingencies and emergencies, including those caused by climate change.”

Over 70 per cent of the Southeast Asian adult population is still underbanked and lacking access to affordable and responsible financial services, while many of the 140 million low- and middle-income workers (72 per cent of the Indonesian workforce) who live from paycheck to paycheck are exposed to the cycle of debt caused by overdraft fees, high-interest credit, and payday loans.

Taking this opportunity, the earned wage access solutions offer a sustainable alternative to employees. With the COVID-19 pandemic and increased levels of financial stress that is directly impacting employers, wagely has become even more important to employees and employers and is well-positioned to further support millions of Southeast Asians with its holistic financial wellness platform.

Image Credit: wagely

The post wagely bags US$5.6M to give Indonesia’s low-paid workers access to their earned wages appeared first on e27.

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