Earnipay was launched last month after being in beta since September 2021. The startup plans to offer its on-demand salary solution to 200,000 employees by the end of 2022 and will leverage the seed funding to target large enterprises, shifting its focus regionally.

The round was led by early-stage venture capital firm Canaan and included investors such as XYZ Ventures, Village Global, Musha Ventures, Voltron Capital, Ventures Platform and Paystack CEO Shola Akinlade.

Earnipay is building an earned wage access platform and integrates with companies’ existing payroll or HRM systems to offer its services to employees, who can then track and withdraw their accrued salaries via the app.

Employees’ salaries are prorated daily and companies can set limits for the percentage of salaries employees can withdraw each month. For instance, if an employee earns ₦300,000 monthly, they can get ₦10,000 daily (for 30 days) or ₦15,000 (if the employer sets the system to count only workdays; 20 in this case).

Earnipay makes these payments on behalf of the company, especially those whose cash flow may be affected should they finance the earned wage payments themselves. At the end of each month, these companies reimburse Earnipay. But for others who can afford to, Earnipay sets up a reconciliation account on top of employees’ salary accounts with scheduled automatic reimbursements.

The startup’s revenues come from charging employees a fee for accessing a part of their salary early. For withdrawals between ₦2,000($4) and ₦10,000 ($20), Earnipay collects a ₦250 ($0.5) fee. For ₦10,000 to ₦50,000 ($100) withdrawals, the charge increases to ₦500 ($1).

Since operating in beta, Earnipay has served over 20 businesses, outsourcing firms and HR solution providers in Nigeria. Some of its clients include Eden Life and Thrive Agric, whose thousands of employees have used the app to access their salary over 1,000 times, said the company.

The new capital, which brings the total fund raised by Stitch to $27,000,000 to date, will be used by the company to create a financial graph ecosystem across Africa.

The financial graph is an infrastructure for financial building blocks that allow businesses to write code once, launch in multiple markets and scale faster based on interoperability across regions, providers, banks, and other types of financial accounts.

The graph utilises three stages — the pure infrastructural play of connecting financial and bank accounts with an API, the acquisition of merchants and businesses to build use cases and applications on top of that infrastructure and lastly, getting end consumers to link their accounts via these businesses.

The round was led by investment firm, The Spruce House Partnership. New and existing investors who also took part in the round include PayPal Ventures, TrueLayer, firstminute capital, The Raba Partnership, CRE Venture Capital, Village Global, as well as fintech founders and companies such as TrueLayer, founders of Chipper Cash, Quovo and Unit, and Guillaume Pousaz’s Zinal Growth.

Stitch provides solutions for e-commerce companies, marketplaces and fintech, with services necessary for driving financial inclusion and ease of payments across the continent.

Wallet-based companies such as Chipper Cash and Luno; embedded finance providers like ImaliPay; subscription platforms like FlexClub; and payment aggregators like Yoco are some of Stitch’s customers who leverage its services for use cases such as KYC & onboarding, personal and business financial management, lending, wallet top-ups and e-commerce checkouts. 

The platform’s data and identity products allow businesses to access customer transaction histories and balance data, verify account information, and perform fraud checks. The payments product enables bank-to-bank transfers for one-click pay-ins and payouts.

Expanding its reach outside South Africa and Nigeria, Stitch sets to step foot into Kenya, Ghana and Egypt soon.