London-based Wagestream, a fintech startup that allows workers to access earned income in real time, has secured £20 million in a round led by Northzone, with participation from QED Investors, Latitude Venture Partners and Balderton Capital. This latest investment, which brings the total raised to £65 million, will be used to consolidate the company’s market share in the UK and to fund its international expansion.
The app allows employees to stream their earned wages into their accounts, giving them control over when they’re paid. Wagestream also offers an automatic savings product called Safestream, which enables users to put aside a small amount of their pay before it’s actually paid to them.
The startup believes these services boost the financial resilience of staff and also protect them from predatory consumer lenders, according to CEO and co-founder Peter Briffett.
Jonathan Levy of Joseph Rowntree Foundation spoke about the tangible — and urgent — benefits of income streaming. “Many of the low paid who have kept the country running during the Covid-19 crisis, including key workers, are most vulnerable to the economic shock to come,” he said. “Financial inclusion tools that reduce the poverty premium and help prevent those on low-incomes from relying on credit due to the painful effects of the monthly pay cycle are going to be essential post-pandemic if these workers are to avoid a vicious cycle of debt.”
Commenting on the investment, Northzone partner Jeppe Zink said, “Income streaming is a unique innovative financial solution that improves people’s lives and there is no doubt that, in the future, Wagestream will become as important as any other benefits like healthcare.”
Founded in 2018, the fintech company serves customers such as Brewdog, Honest Burgers, Rentokil and five NHS trusts, reaching about 300,000 workers.