Abhi: earned wage access as a door to credit

Biography

Omair Ansari is the co-founder of Abhi, a Pakistani fintech startup. Abhi started off by offering earned wage access (EWA), where employees can receive their due salary (for the number of days worked) rather than wait for the end of the month. 

Abhi has since expanded into payroll management and SME financing. The company has raised over $250M in funding, mixing debt and equity.

Prior to Abhi, Omair worked in finance for over a decade, including a 4+ years stint at Morgan Stanley.

You stated that Pakistani fintech’s “base layer” was built. What does that mean and why is it relevant?

In Pakistan, initiatives such as Raast and 1link have laid fintech’s foundations, similar to what UPI did in India and Pix did in Brazil. Namely, digital payments and wallets. 

It is foolish to not treat wallets as bank accounts (some of them are already lending). Founders re-building these products under the guise of a “neobank” are mistaken - alternatives to their product exist and are performant. 

So Abhi starts with earned wage access (EWA). Why?

On those fintech foundations, financial services can be layered. B2C credit is a big one. 

In Pakistan, credit-scoring data for B2C is scarce, despite Raast and 1link increasingly churning out useful insights. A Pakistani B2C credit play is further complicated by enforceability. Credit isn’t a disbursement but a collection business. In Pakistan, the infrastructure for a company to collect what it’s owed is still thin.

EWA minimizes both of those risks. The credit-scoring data we’re tapping is unambiguous, since it’s the individual’s salary. On the collection side, we’re collecting from the employer, not the employee, which lightens the operational load.

What did your MVP look like and how did you muster up initial traction?

We went to businesses and told employees to WhatsApp us if they wanted an advance on the salary they were owed for the month so far. 

It wasn’t easy. There’s an overall distrust of consumer credit in Pakistan, for good reasons. Many of the existing options are tied to unsavory actors, with strings attached, hidden fees and  “rowdy” collection methods. To put it bluntly: customers needed to know that Abhi wasn’t going to break their legs. 

The product had evident traction with employees, but was harder to sell on the employer side. Although it is of no financial cost to them (Abhi takes a cut out of the salary it advances to employees), it requires additional administrative work. To soften that resistance, we’ve expanded into B2B products (payroll management, SME lending) that we can bundle alongside the EWA product. 

What elements of your Morgan Stanley experience give you an unfair advantage?

I worked in frontier/emerging market equity and derivatives for over a decade. A large chunk of that time was spent analyzing businesses operating in these markets. History doesn’t repeat but it rhymes. Understanding why certain businesses survived macro-shocks in Egypt or Nigeria (and why others didn’t) has been invaluable to running Abhi in the Pakistani context. 

My experience informed how we’ve structured Abhi’s debt. To assuage FX risk, we’ve localized it entirely (we borrow and lend in local currency). This reduces Abhi’s exposure to currency depreciation, as the currency we owe can't suddenly detach itself from the currency we earn in.