Advancly Extends $1 Million Debt Facility to Zofi Cash for Expanding Earned-Wage Access

Zofi Cash, a Ugandan fintech startup, has secured $1 million in a pre-seed round from Advancly, addressing the financial challenges faced by many African employees who receive monthly paychecks but encounter daily expenses.

Traditionally, salary advances from employers or banks have been the go-to solution, but strict loan requirements and cash flow issues often hinder their availability. To bridge this gap, earned-wage access startups have emerged across the continent, offering employees the opportunity to access a portion of their earnings before payday. Zofi Cash is among these startups, aiming to provide a viable solution with their recent funding boost.

Zofi Cash, established in 2021 by CEO Paul Kirungi and CTO Gordon Turibamwe, is part of the increasing number of African fintech companies that offer convenient salary access to individuals. Through their web application, employees have the option to request up to 50% of their monthly salary as an advance. Once approved by the employer, the advance is transferred to either a bank account or a mobile money service.

Despite challenging funding conditions, Zofi Cash has achieved notable success, facilitating transactions exceeding $300,000 over the past year, which played a significant role in attracting capital for the company.

“We have strong metrics. In a year, we have been able to make transactions worth $300,000. Raising this funding has been extremely hard, but our commitment to making sure no one has to wait for a payday to receive their salary kept pushing us,” Kirungi said.

Despite having a waitlist of over 20,000 employees, Zofi Cash has been able to serve only around 3,000 individuals so far. However, with the recently acquired debt funding, the startup aims to expand its reach and cater to a larger number of people. While operating in Uganda, Zofi Cash will face competition from Qiribu, a startup that entered the market a year prior. In the event of Zofi Cash’s expansion beyond East Africa, it would encounter competition from other similar platforms such as Workpay, and Earnipay.