EWA Startup Gajiku Receives Initial Funding of 16 Billion Rupiah
Startup earned wage access (EWA) and HR platform Gajiku announced an early-stage investment gain of $1.1 million (approximately 16 billion IDR).
This round was led by AC Ventures, with participation from Agung Ventures, Monk’s Hill Ventures Scouts Program, Sampoerna, and several Indonesian angel investors.
The fresh funds will be used for product development, driving sales and business development to bring in new users, focus on large companies, and increase the number of employees across all functions.
The startup was founded in January 2021 by a number of founders, including Sherman Tanuwidjaja (CEO), with deep experience in developing technology focused HR solutions for large clients including Temasek; and Herry Gunawan (CTO), who previously served as Head of Engineering at Ruangguru and Lead Engineer at Tokopedia.
About Gajiku Platform
This company provides a payroll and employee management solution provider that enables employees to access on-demand payroll through an employer-centric approach.
This startup offers a complete suite of employee management processes for attendance, KPI tracking and payroll disbursement, helping employers digitize their human capital and accounting operations.
Companies generally work with large corporations, such as large retail and manufacturing companies with an average of more than 1,500 employees per company.
About ninety percent of employees that registered at Gajiku transact at least once a month through partnerships with conglomerates and Indonesian companies.
Gajiku is typically used by labor-intensive companies that employ thousands of blue-collar workers, most of whom are considered unbanked and may work in informal settings.
Low financial literacy among blue-collar workers in Indonesia has made them particularly vulnerable to moneylenders and other predatory lenders. These workers are likely to live paycheck to paycheck or are likely to disappear from the workplace due to immense financial stress.
By offering on-demand payroll services, the employers can provide a lifesaver for their employees, helping them relieve financial stress and reduce employee turnover.
By combining access to earned wages with human resources and financial services, this platform is able to provide a complete range of services that reduce employee turnover. Increase business efficiency, and provide financial well-being for the Indonesian working class.
“With more and more businesses seeing Indonesia as part of a global supply chain, we are working with employers to improve employee management. While ensuring that their employees are in the best financial position to succeed,” said Gajiku Co-founder and CEO Sherman Tanuwidjaja.
AC Ventures Managing Partner Adrian Li added, given that Indonesian workers often sign informal agreements, employee management is a top priority for businesses in increasing efficiency and reducing turnover.
AC Ventures believes that Gajiku’s company-centric approach will enable the employers to positively impact the majority of employees through access to early wages and other financial services possibilities.
Factors Driving the Presence of EWA
In Indonesia itself, there are already several startups that specifically provide EWA solutions. They are GajiGesa, Gigacover, wagely, KoinGaji (from KoinWorks), and HaloGaji (from Halofina). The presence of EWA is an adoption of similar solutions that have previously been present in developed countries.
The driving factor is because money is the main source of stress in Indonesia, citing the Health Living Index published by AIA. Household finances cause people to be more stress than relationships, work, or even their physical health.
Another global survey conducted by PwC in 2019 found that 67% of workers reported struggling with financial stress, meaning more than two-thirds of the working population are prone to migraines, depression and anxiety.
There are many studies that highlight the effects of employee financial stress on the business performance. Workers spend three or more hours per week focusing on financial matters rather than their work, according to PwC.
Of the employees who reported financial stress, 12% lost their jobs because of the problem, and 31% felt their productivity was affected. One of three workers admit to being less productive at work because they undergo financial stress.