Nigerian startup Earnipay raises $4m to provide on-demand pay to workers

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Earnipay, a financial technology solution that provides flexible, on-demand access to employees, announced Friday that it has closed a $4 million funding round to expand its operations in Africa.

This was revealed by Maria Adediran, Account Manager at Earnipay, in a statement to PREMIUM TIMES.

Founded by Nonso Onwuzulike in 2021, To earn officially launched its operations last month. The company says it wants to improve the financial well-being of employees by partnering with employers and seamlessly integrating with their payroll systems to offer its services to employees, who can then track and withdraw their accrued wages through application any day of the month.

“At the end of the month, the employer deducts the withdrawn amount from the employee’s salary, reimburses Earnipay with it, and then pays the employee the balance as salary for that month,” the company said.

“Earnipay charges employees a nominal processing fee of NGN 250 or NGN 500 for this access. There are no refunds or interest charges because employees have access to what they worked for, it is their money,” the statement read.

The funding round was led by Canaan, with participation from XYZ Ventures, Village Global, Musha Ventures, Ventures Platform, Voltron Capital and Paystack.

According to the company, with the seed funding, Earnipay will accelerate the development of its technology platform to serve large enterprise employers. In doing so, Earnipay will provide employees with the tools they need to make better financial decisions and improve their quality of life.

The company plans to offer its pay-on-demand solution to 200,000 employees by the end of 2022.

The document further states that Earnipay has already served more than 20 companies, outsourcing companies and HR solution providers in Nigeria.

Speaking on the funding cycle, CEO Nonso Onwuzulike said, “Financial worries are the number one cause of distractions in the workplace. The monthly pay cycle means employees are often unable to pay day-to-day expenses, cover emergencies, or take advantage of immediate financial opportunities.

“As a result, they are exposed to predatory payday loans and get stuck in endless cycles of debt with unrealistic repayment periods and high interest rates.

“Earnipay exists to solve this problem and provide an ethical alternative to instant access to pay while helping employers improve employee engagement and retention at zero cost to their business.

“The future of pay is on-demand, and we are thrilled to be pioneering this incredible solution in Africa. I am thrilled to partner with a group of highly respected investors who understand the need for a platform such as Earnipay to improve access to wages and, most importantly, to improve the financial well-being of income earners in Africa,” says Mr. Onwuzulike.

“We are systematically tackling inefficiencies in the way Africa’s workforce interacts with wages and will continue to create products and services with both employers and employees in mind,” he noted.

“We’ve seen access to earned wages growing rapidly in many markets and we think it’s a natural fit in Africa,” said Canaan Partner Brendan Dickinson.

“Earnipay quickly established itself with a product designed specifically for payroll behaviors in this region, and early adoption by employers is very strong. Nonso has built one of the strongest teams we have encountered on any continent, and we are delighted to have the opportunity to partner with them,” he said.

Employers can sign up for Earnipay through the web-based platform to access the employer dashboard and add their employees in a simple process, he said.

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