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Hi there,
I’m not one to mark my payday on the calendar, but once or twice a month, and especially when I’m making a larger purchase, I do think about whether the month’s salary has been credited into my bank account.
I’m fortunate to be on a consistent and predictable payroll, but for the increasingly many who live on irregular paychecks, brought about by the pandemic or otherwise, startups that provide earned wage access (EWA) to employees could be a real game changer.
These third-party providers calculate the monthly wages earned by an employee up to any point in time and make these funds available ahead of payday at a nominal fee.
EWA startups work directly with employers, and withdrawals made by employees don’t count as a loan (and therefore have no interest).
It’s a potentially lucrative field. At any given point in time, there is approximately US$1 trillion of payroll accrued in employers’ treasuries across OECD countries before it is paid to employees, a study by Ernst & Young found last year.
In our big story this week, Thu Huong Le dives into the payday revolution that’s catching on in Southeast Asia and how it has the potential to change the lives of millions.
— Melissa
THE BIG STORY
Disrupting the paycheck in SEA: a billion-dollar market with social impact?
Image credit: Timmy Loen
Startups that help Southeast Asians draw wages before payday could also pull workers away from loan sharks.
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