Tech for Good – Social Impact
Merit Recipient

AMP’s 2020 research has found severe and moderate levels of financial stress are impacting 1.8 million Australian workers, with nearly half feeling financially stressed for an average of six and a half years or more. In total, 50 per cent of all Australian workers reported some level of stress about their finances.

Earnd’s mission is to reduce the impact of financial stress on both Aussie workers and businesses by reducing the poverty premium where those on lower incomes pay more in late fees and more for credit and other different types of services. In this way, earned wage access can have a profound impact – increasing financial inclusion for those who are also unable to access traditional forms of credit and are forced to turn to payday lenders.

An analysis of 1 million transactions and 2,200 anonymous surverys found seven in 10 people feel more in control of their finances and one in two people say there’s been an improvement in their ability to plan their finances since downloading the 2 of 10 app. What’s more, 88% reported a decreased usage of payday loans, while 39% reported a decrease in overdraft use and 31%
reported a decrease in credit card use.

Young workers are increasingly targetted by fintechs that look to profit from worsening their financial position.

‘Pay advance’ providers (which are frequently seen advertised on billboards, buses, radio and TV) offer a short-term loan that lets someone borrow up to 25% of their previous pay cheque to a maximum of $1,250 ahead of payday, for a fee. Fees vary but are typically set at 5% per withdrawal.

Research from ASIC has found that 1 in 5 people using Buy now, Pay Later incur late fees. These fees start from $5-$15 and can be much higher on larger purchases. The fees can also add up significantly when people are managing multiple Buy now, Pay later purchases. A recent article from The Australian Financial Review reported that those who have been using Afterpay for
more than four years transact 29 times a year, while the top 10 per cent of its customers use it 60 times a year.

These offerings lead to alarming stats like seven in 10 employees regularly facing financial shortfalls (according to EY), one in three Aussies unable to access $500 in an emergency (according to CommBank) and one in two Aussie workers reporting financial stress (according to AMP).

Earnd is the anthesis of this growing movement of fintechs. Our aim is to make money simple, not stressful. We hold these three key beliefs in our product development and everything we do:
No one should have to pay unnecessary interest on high cost credit Everyone should have savings for a rainy day All financial goals should be achievable.

The key to this is seeing earned wage access not as a way to increase spending, but to cover emergencies and increase an employee’s ability to grow their savings and repay debt.