- EWA startups secure debt financing for growth.
- Companies target large businesses to achieve profitability.
- Services expand beyond early wage access to comprehensive financial platforms.
Earned-wage access (EWA) startups in Southeast Asia are attracting significant funding, particularly in the form of debt financing.
Recent examples include Malaysia’s Paywatch raising $30 million and Indonesia’s Wagely securing $23 million in their respective Series A rounds.
This trend highlights the growing confidence in the EWA model among investors and financial institutions.
Scaling up and cashing in
EWA providers are turning to credit facilities to ensure sustainable growth at scale.
Companies like Paywatch are disbursing millions in early salaries monthly, necessitating larger capital pools.
The shift towards targeting large businesses with substantial workforces is part of their strategy to achieve profitability, with some aiming to break even by 2025.
Beyond payday
As the EWA sector matures, startups are expanding their services to become comprehensive financial platforms for workers.
Features like bill payments, insurance, savings, and investments are being integrated to create additional revenue streams and address concerns about over-reliance on early wage access.
This evolution positions EWA companies to fill the gap left by traditional banks in serving lower-income customers.
To read the original article: https://www.techinasia.com/why-ewa-startups-tap-debt-financing-in-push-for-profits
