Vietnamese fintech GIMO has raised US$17.1m in Series A funding for its earned wage app, which allows underbanked workers to access their earnings at any time.
It is the latest in a rising tide of earned wage access solutions, which help employees to get small advances on their monthly paycheck without having to wait until payday. GIMO already offers earned wage access to roughly 500,000 Vietnamese workers, and is on course to reach 2.5m underbanked employees by 2025.
The country’s fintech sector has ballooned in recent years, projected to reach a valuation of US$18bn by 2024, according to Robocash Group. Between 2016 and 2021, venture funding increased by more than 500%. But despite this, Vietnam has one of the world’s highest proportions of unbanked and underbanked consumers – around 70% of the population, according to some estimates – making it hard for people to access financial services when they need them.
According to KPMG, the typical earned wage user draws down on their pay two or three times a month, simulating weekly or fortnightly pay cycles. GIMO believes that, in this way, earned wage tools are alleviating burden from blue-collar workers.
New investment will drive GIMO forward
“We are thrilled to announce the successful closing of our Series A funding round, which demonstrates the unwavering confidence and support we have received from investors,” says GIMO Co-Founder and CEO Quan Nguyen. “This significant investment will enable us to drive our vision forward, fuel innovation and continue to serve the underserved communities in which we live and operate.”
In particular, the startup will use the money to bolster its R&D efforts, accelerate product development, enhance customer success and support initiatives, and forge new strategic alliances with industry partners and leaders.
The latest investment, split over two separate closes, is led by TNB Aura with participation from existing backers including Integra Partners, Resolution Ventures, Blauwpark Partners, ThinkZone Ventures, and Y Combinator.
Inward investment from American and Singaporean backers reflects international confidence in the Vietnamese economy. The country’s GDP is US$360bn a year and it was once tipped to become a financial powerhouse, but the country does not appear in Goldman Sachs’ predictions of the 15 largest economies by 2075 – losing out to other Asian economies like Indonesia, Pakistan, and the Philippines.
Vietnam could become an EWA hotspot
Nonetheless, Zhi Yong Heng, Managing Partner of AlteriQ Global, believes the country is still a great testing ground for earned wage access solutions: “We believe that the Vietnam market is ripe for the adoption of earned wage access, which will drive financial inclusion and stability for the underserved.
“At AlteriQ, we consistently strive to forge partnerships with top-tier business operators across industries and geographies. Our decision to support GIMO marks our debut into Vietnam, and we are excited to work with Quan and his team to scale their operations and create a positive impact on the financial well-being of the underserved communities.”
Charles Wong, Founding Partner of TNB Aura, adds: “We look forward to working closely with the GIMO team in breaking down barriers to financial inclusion for millions of blue-collar workers across Vietnam. Especially in challenging macroeconomic times such as these, GIMO’s mission to empower workers to ‘Live Better. Work Happier’ is even more critical.”
It is the latest funding milestone for the earned wage access market: in the last six months, US fintechs Rain and Clair have both raised in excess of US$100m for their earned wage solutions, although the sector faces increasing scrutiny. Nevada and Missouri have become the first US states to regulate the EWA industry, forcing providers to become licensed.
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