Clair, an American startup that wants to disrupt the payday loan industry and help hourly workers and workers get paid instantly, has raised $ 4.5 million in seed funding.
The cycle was led by Upfront Ventures, with input from the Founder Collective and Walkabout Ventures, as well as former Venmo COO Michael Vaughan and Seamless Founder Paul Appelbaum.
New York-based Clair describes itself as a “social impact” startup that works to help the 82 million hourly workers and 57 million concert workers in the United States get paid instantly.
The firm says that, especially during the pandemic, many Americans will struggle to cover an unforeseen expense, forcing them to take out high-interest payday loans that trap them in cycles of debt.
Its response is to break away from the standard two-week payroll cycle by integrating its financial services into workforce management, payroll and concert platforms. Workers who choose Clair as their direct deposit account can get free advances on a portion of their earned wages, which they can access using their Clair debit card. The advances are then deducted from their account during the next payday.
The startup offers workforce management software vendors a set of turnkey products as well as APIs, allowing them to set up instant payments and deliver its services and products to their customers within days.
Nico Simko, veteran of JPMorgan and CEO of Clair, said: “We believe that everyone should be able to freely access the money they have already earned. There are more payday lenders than McDonald’s in the United States that charge an average of over 300% annual interest on loans. So we have a simple vision: it’s time to change.
Payday Loans will be discussed in depth at EBAday 2020. For delegate passes, register now and join the leaders of the payments ecosystem in Europe as EBAday addresses’ Turning Point of Transformation payments ”.
