Nigerian fintech startup Earnipay, which provides flexible and on-demand salary access to income-earners, is now quickly scaling after US$4 million funding round.
Founded by Nonso Onwuzulike in 2019, Earnipay integrates employer payroll and HRM systems to enable on-demand financing for employees to access their earned salary instantly, without interest.
Its solution helps organisations improve employee engagement and productivity by relieving financial stress caused by eliminating the need for a salary advance or predatory payday loans with interest rates.
Onwuzulike initially started Earnipay to address the high attrition rate among waste collection staff at his recycling company. Upon transitioning from a monthly payment schedule to a more flexible system, offering weekly or bi-weekly payments, productivity improved and employee retention increased. He then surveyed 100 formal employees within his network to assess their financial needs and employer responses to those needs.
“Initially, Earnipay was envisioned as a salary advance solution, akin to existing solutions in Nigeria, some of which were provided by traditional banks. However, when 90 per cent of surveyed employees expressed a preference for flexible access to accrued salaries, Earnipay’s focus shifted accordingly,” Onwuzulike said.
After beta testing and development since September 2021, Earnipay fully launched in January 2022 as a pioneer of on-demand pay in Nigeria, offering employees flexible access to their earned salaries at any point during the month.
“By partnering with HR departments and business owners, Earnipay aimed to enhance employee benefits and address common payroll processing challenges, such as payment reconciliation and benefit distribution,” said Onwuzulike.
“Recognising that businesses also faced financial shortfalls and long wait times between customer payments, Earnipay expanded its scope to provide comprehensive business solutions, addressing financial, people operations, and employee benefits challenges.”
Earnipay’s product suite is designed to boost employee satisfaction, productivity, retention, and overall business growth. Aside from on-demand pay, offerings include financing, people operations solutions, and financial wellness solutions.
The startup, which in February of last year closed a seed round of US$4 million to scale its offering, has grown slower than expected, Onwuzulike said, since on-demand pay was a relatively new concept in Nigeria, and Earnipay was a “pioneer in the space”.
“Nigerian employees were accustomed to receiving their salaries at the end of the month, despite the clear advantages of having access to their earnings at any time for bill payments, savings, and more. To facilitate a shift in mindset, we focused on educating the market,” Onwuzulike said.
“Our dedicated team, which includes sales, customer experience, product, engineering, and marketing professionals, has worked tirelessly to develop a reliable product that employees can trust. As a result, we now have a growing pipeline of businesses that we are onboarding.”
Following the company’s rebranding earlier this year to encompass finance, people operations, and employee benefits solutions, Onwuzulike said the demand for its expanded product offerings has surged.
“We plan to launch additional products soon, as there is a strong demand for Earnipay’s services and a robust pipeline of customers eager to utilise these new products,” he said.
At present, Earnipay serves the Nigerian market, operating in all 36 states.
“We are privileged to also have in our customer base various outsourcing and recruiting firms with employees distributed throughout the country. In the future, we plan to expand our reach to include Francophone countries and regions in Northern Africa,” said Onwuzulike.