By Mark Kawalya
Qiribu a Ugandan fintech has launched an earned wage access product, making it the first of its kind within the East Africa. The startup provides employees earning a salary the ability to access a portion of their earned wages before their regular payday. The product is particularly useful for employees who run into cash flow problems and need a boost to carry them until their next payday.
Qiribu works with employers to set up a system where employees can request and receive a portion of their earned wages at any point during the pay period. The employer later reimburses Qiribu at the end of the pay period. Qiribu has plans of expand its earned wage access product into Kenya and Rwanda in a few years.
“In addition to providing a convenient way for employees to access their earned wages, we are going to add other financial services such as budgeting tools and financial education resources to help workers better manage their finances,” Dan Wasswa, the startup’s CEO and co-founder, told Disrupt Africa.
Qiribu spotted a gap in the market, which led to the creation of its earned wage access product.
Wasswa, said that the company originally intended to create a neo-bank specifically for the Ugandan market a couple of years ago. However, after conducting research and talking to potential users, the company realised that the issue wasn’t just about the user interface or usability. Many people only interacted with their bank once a month, and running out of cash during the month was a common problem, especially for young employees in industries like hospitality, retail, and manufacturing.
“We noticed that the options for affordable and accessible capital for users in our target user group were limited from traditional financial institutions. We also saw a concerning growth of high interest, predator payday loan apps in East Africa. We saw an opportunity to provide a better alternative for individuals in need of low cost, easy access financial assistance,” said Wasswa.
Qiribu’s earned wage access product has seen slow early growth, but the company has plenty of interest. Its first client, a company with 30 employees, has 10 active users of its product, while more are soon coming on board. Qiribu is also in advanced talks to onboard a nationwide coffee shop chain that employs over 100 staff, which could significantly increase its user base and bring in more revenue.
Qiribu makes money by charging a flat transaction fee to users when they advance or “cash out” their earned wages. The company also plans to launch its Qiribu bank card, which will allow users to “cash out” for free. Instead, the company will make money from the card transactions made by users. Overall, Qiribu’s business model is based on charging fees for the convenience and accessibility of accessing earned wages in real-time.