Paymenow, South African earned wage access (EWA) startup, has secured a $14m debt facility to expand its operations and increase access to its services across the country.
The facility was provided by Lendable, a UK-based technology-enabled alternative lender. Paymenow, which was founded in 2019, offers financial support to employees by allowing them to access a portion of their earned but unpaid wages before payday.
The company aims to improve the financial well-being of workers by helping them avoid high-interest loans and other forms of credit. Paymenow charges a flat fee for its service, which is significantly lower than the interest rates charged by most payday lenders.
Details of the debt facility and the investors involved
The new debt facility will enable Paymenow to extend its services to more workers in South Africa, where more than half of the population lives below the poverty line. It will also help the company to scale up its technology platform and improve its user experience.
According to Sibusiso Ngwenya, CEO and co-founder of Paymenow, the debt facility will help the company achieve its goal of providing financial inclusion to millions of workers in South Africa.
“We’re delighted to have secured this debt facility, which will enable us to extend our reach to many more people who need our support,” Ngwenya said. “We’re committed to making a positive impact on the lives of workers in South Africa, and this funding will help us to achieve that.”
Paymenow has already partnered with several major employers in South Africa, including Coca-Cola, Shoprite, and Sasol. The company claims to have helped thousands of workers to access their earned wages before payday, reducing their reliance on expensive credit and improving their financial well-being.
Paymenow’s plans for the future
The EWA sector has grown rapidly in recent years, as more workers seek flexible and accessible financial services. According to a report by the World Economic Forum, the EWA market is expected to reach $240bn globally by 2023. With this new debt facility, Paymenow is well-positioned to capture a significant share of this growing market in South Africa.
In conclusion
Paymenow’s recent debt facility is a significant boost for the company as it seeks to expand its services across South Africa and beyond. The investment from Lendable and its other partners is a testament to the value that the startup offers in the wage access industry, which has seen significant growth in recent years. With the additional funds, Paymenow can continue to develop its platform and provide much-needed financial relief to workers in South Africa who face unexpected expenses. It will be interesting to see how Paymenow utilizes the funds and what other developments it has in store for its users.
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