[aladhubhai]

We are Ali and Omair of Abhi (http://abhi.com.pk/). We are a financial wellness platform in Pakistan, focusing on providing early wage access to the salaried class.

Most employees in Pakistan live paycheck to paycheck, not having savings for emergencies or random bills. Many pay their bills late, as payroll disbursement often does not coincide with bill cycles, incurring hefty payment fees. Fewer than 20% of the population have access to formal credit; banks are stringent in their underwriting and have not been focused on consumer lending due to high returns on treasury investments. In a population of 220M, consumer finance products have a total value of less than $3.5B. Meanwhile the total value of monthly payroll processed in Pakistan is between $6B and $8B. Without access to credit, people turn to friends and family, try to get advances from their employer, or resort to loan sharks.

The idea for Abhi came from first hand experience of constantly being asked for money by friends and family and speaking to companies on how often they have seen requests for salary advances. We also have seen how it takes over 45 days to get a loan from a bank or get approved for a credit card. My cofounder Omair, who was working at Morgan Stanley, had also been studying the early wage access model around the world and the uptake it had in emerging markets. After running a small pilot with 400 employees, we decided to work on a B2B2C model to provide advances to consumers via their employers to reduce delinquency risk.

We partner with employers to offer financial well-being benefits that improve retention, productivity and employee engagement. Our mission is to help millions of people across Pakistan live healthier, happier financial lives. We do this by offering: access to their salary as it is earned; affordable advances; and engaging financial education. In surveys we have found employees using these funds for utility bills, home maintenance, fixing their vehicles, medical expenses, and weddings.

We provide instant access to earned wages to all employees of any company that has signed on with us, without the need for any documentation. We allow this through 4 touch points: a mobile app, 2 way SMS, WhatsApp, and a web portal. The funds get sent to the employee within a minute, to their existing payroll account held in any bank or mobile wallet in Pakistan. We also provide advances when needed, for which we charge a flat 2% transaction fee. These are collected on the next payroll, eliminating late fees and loan shark interest rates.

[devoutsalsa]

Out of curiosity, does your revenue stay in Pakistan, or do you transfer it to a bank in the USA or elsewhere? I find it interesting I can use Wise to send money to Pakistan, but not from Pakistan. Just wondering if y’all have a similar challenge and/or how your deal with it.

[aladhubhai]

Yes the revenue stays in Pakistan There are restrictions on outward remittance from Pakistan except for special cases.A large remittance from a company account requires permission from the central bank. Hope this answers your question.

[wizwit999]

How do you make money? Models I've seen here are all essentially riba (interest).

Have you looked into sharia compliance, I would say it's necessary for your market.

[aladhubhai]

We charge a 2% transaction fee of the amount of advance requested. Yes we are a Shariah compliant product.

[WasimBhai]

Very happy to see a startup from Pakistan, here! Best of luck to Abhi!

However, how many employers have signed up with you? What kind of salary ranges are you targeting?

[aladhubhai]

Thanks. We currently have access to an employee base of over 200,000 from the MoUs we have signed. We are currently piloting so will know shortly in what salary range the product uptake is highest. However we feel that the product will be most useful for those who are earning between PKR 25000- PKR 100,000/-.

[shahryart76]

congrats and best of luck! really happy to see pakistani startups getting in through yc.

Couple of questions:

Some amount of businesses in Pakistan are known to delay paying out wages too. Do you intend to deal with this problem?

It's hard to gather ground truth data in Pakistan. How did you go about gathering/verifying data?

[aladhubhai]

Thanks. Yes we do intent to provide interim payroll financing to companies who have delays in paying wages. However this is based on us running a risk assessment of the companies who we provide this service.

We are working on a B2B2C model so we gather information from the employer. Further we run a title fetch on the account number provided by the employer to make sure that the account number pertains to the employee whose data has been provided by their employer. Leveraging the existing financial infrastructure in Pakistan allows us to reduce the amount of data gathering and verifications on the customers we service.

[asukhwani]

Congrats on the launch guys. This is a real need!

[aladhubhai]

Thanks

[shayankh]

congrats! and best of luck!

[aladhubhai]

Thanks