Clair Partners with Gusto to Offer Embedded On-Demand Pay to Employees at Many of Their 300K Businesses

Rhea-AI Summary

Clair, a fintech company offering free Earned Wage Advances (EWA), has partnered with Gusto, an integrated payroll and HR platform. This collaboration introduces Clair's new Embedded Offering to Gusto's 300,000 supported businesses, allowing employees to access On-Demand Pay via Gusto Wallet.

Key points:

• Gusto is the first partner to leverage Clair's new Embedded product
• The partnership addresses the growing demand for financial wellness benefits
• Clair's EWA is bank-issued with no interest, powered by Pathward®, N.A.
• Gusto Wallet Premium members can access a portion of their earnings daily without affecting credit scores

Positive

• Partnership with Gusto expands Clair's reach to potentially 300,000 businesses
• Clair's EWA offering is bank-issued and interest-free
• Clair facilitates millions of dollars in EWAs monthly
• Gusto selected Clair out of nearly a dozen on-demand pay solutions
• The partnership addresses the #1 most requested feature by Gusto Wallet users

Negative

• None.

Insights

Financial Analyst

The partnership between Clair and Gusto to offer embedded On-Demand Pay is a significant development in the financial wellness and HR tech sectors. From a financial perspective, this collaboration addresses the growing demand for financial wellness benefits, which is an attractive perk for employees. Given that 80% of employers plan to increase their investment in such benefits, this partnership positions both companies favorably in a competitive market.

For Clair, integrating into Gusto's platform, which supports 300,000 businesses, could significantly expand its user base and revenue streams. This move leverages Clair's compliance framework and technical capabilities, which were likely key differentiators. For Gusto, offering EWAs through Clair enhances its value proposition, making its HR platform more comprehensive and appealing to current and potential clients. This can improve client retention rates and attract new businesses seeking robust financial wellness solutions for their employees.

Over the short term, both companies might see an increase in adoption rates and user engagement. In the long term, this collaboration could lead to higher customer loyalty and a solidified market position in the rapidly evolving HR tech and financial wellness landscape. However, it's essential to monitor the regulatory environment, as changes could impact the EWA model's viability and compliance requirements.

Market Research Analyst

From a market research perspective, this partnership responds to a critical need in the market—financial wellness benefits. With EWAs being the most requested feature by Gusto Wallet users, meeting this demand through Clair's robust infrastructure is strategic. The integration into Gusto's established platform allows for a seamless user experience, likely increasing the adoption rate among employees who value financial flexibility.

This trend towards EWA adoption reflects broader changes in workforce expectations, where employees seek greater control over their earnings. This collaboration could set a precedent, encouraging other HR tech platforms to explore similar partnerships, thus expanding the EWA market. The fact that Gusto chose Clair over nearly a dozen competitors highlights Clair's strength in compliance and technical expertise, which could influence market dynamics by setting high standards for other EWA providers.

While the immediate impact will be an enhanced user experience and increased satisfaction among Gusto's business clients, the long-term effects could include overall market growth and heightened competition in the EWA space. Market players will need to focus on compliance, user experience and seamless integration to stay competitive.

Gusto Is the First Partner to Leverage Clair’s New Embedded Offering That Seamlessly Integrates Earned Wage Advances Into HR Tech and Payroll Platforms

NEW YORK--(BUSINESS WIRE)-- Clair, the pioneering fintech company offering free Earned Wage Advances (“EWA”) originated by a national bank, today announced a unique new partnership with Gusto, an integrated, all-in-one software platform that automates and simplifies company payroll, benefits, and HR. Through this collaboration, Clair and Gusto are breaking ground on a technology-first solution in the EWA industry, granting employees at many of Gusto’s 300,000 supported businesses access to sign up for On-Demand Pay via Gusto Wallet, which helps employees increase prosperity by delivering financial and work productivity tools. Gusto is the first partner to announce this new Clair Embedded product, which leverages proprietary technology to provide an embedded, compliant EWA solution that integrates into workforce management and payroll applications.

This new product and partnership has launched at a time when employers are increasingly turning to financial wellness benefits to attract and retain talent. About 80% of employers offering financial wellness benefits to employees last year said they planned to invest even more in these perks in 2024. In alignment with this trend, EWAs are the #1 most requested feature by employees using Gusto Wallet.

To meet this growing demand, Gusto is partnering with Clair to leverage the advanced lending infrastructure and compliance framework developed by the fintech team over the past three years. This collaboration provides a robust and seamless solution for EWA in a changing regulatory environment. Gusto selected Clair out of nearly a dozen on-demand pay solutions for its compliance framework and technical capabilities. Powered by its partnership with national bank Pathward^®, N.A., which is the entity issuing all the advances directly to the consumers, Clair is a leading EWA provider offering bank-issued EWA with no interest. The company already partners with over a dozen workforce management platforms to provide On-Demand Pay to their connected users and facilitates millions of dollars in EWAs every month.

“Emergency expenses often arise and employees need a secure and convenient way to cover those unexpected costs,” said Dan Loomis, General Manager and Head of Product at Gusto’s Members business unit. “Due to these needs, we decided to add an on-demand pay offering to Gusto Wallet and knew it would be crucial to find the right partner to bring it to life in a seamless, compliant way. We evaluated all the major players in the EWA space and Clair stood out as our ideal partner, bringing both the compliance framework and technical capabilities we need to offer wage advances right inside our existing app. We’re proud of this industry-leading collaboration that expands the possibilities of embedded financial wellness benefits.”

Clair’s On-Demand Pay feature has already begun rolling out to Gusto members, who have access to a variety of financial benefits in Gusto Wallet, which include interest-bearing accounts backed by FDIC-insured bank nbkc, a debit card for purchases or cash withdrawals from ATMs, and budgeting and tax tools. This new collaboration expands on Clair and Gusto’s existing partnership with Gusto Embedded, the company’s payroll API, which provides EWA to workforce management platforms that are adding payroll processing for their users.

“Our team has long admired Gusto for how it removes friction from the workforce management and payroll process to move the HR tech industry forward,” said Nico Simko, Co-founder & CEO of Clair. “After successfully partnering with Gusto Embedded, we’re honored to power Gusto Wallet’s compliant On-Demand Pay feature, so millions of Gusto members can get paid when they want to. With this launch of our Clair Embedded product, our goal is to ensure that human capital management platforms don’t need to drive members away from their existing apps to access Clair On-Demand Pay. We’re thankful to Gusto for pioneering this offering and we’re looking forward to helping many more HR and payroll companies add the same kind of value for their customers.”

With the new Clair On-Demand Pay feature, Gusto Wallet Premium members can:

• See in the mobile app how much of their paycheck they can access
• Access a portion of their earnings each day
• Avoid a credit pull, which can affect credit scores
• Automatically repay their EWA when their next paycheck arrives

See Clair On-Demand Pay in action within the Gusto Wallet app.

About Clair

Clair is the pioneering fintech company offering free earned wage advances originated by a national bank. Clair helps professionals get paid before payday, supported by its partnership with FDIC-insured national bank Pathward, N.A. Clair is available at over 10,000 employers and more than a dozen workforce management platforms to help increase employee retention and financial wellness amid front-line worker shortages. Clair is based in New York and has raised $45 million in VC equity funding from investors including Thrive Capital, Upfront Ventures, Kairos, and Founder Collective. For more information, visit getclair.com.

About Gusto

Gusto is a modern, online people platform that helps small and medium-sized businesses take care of their teams. In addition to full-service payroll, Gusto offers access to health insurance, 401(k) integrations, HR experts, employee self-onboarding, and team management tools. The company serves over 300,000 businesses nationwide and has offices in Denver, New York City, and San Francisco. For more information, visit gusto.com.

About Pathward^®

Pathward, N.A., a national bank, is a subsidiary of Pathward Financial, Inc. (Nasdaq: CASH). Pathward is a U.S.-based financial empowerment company driven by its purpose to power financial inclusion. Pathward strives to increase financial availability, choice and opportunity across our Banking as a Service and Commercial Finance business lines. The strategic business lines provide end-to-end support to individuals and businesses. Learn more at pathward.com.

Disclosures:

Clair is a financial technology company, not a bank. All Advances are originated by Pathward^®, N.A. All Advances are subject to eligibility criteria and application review. Terms and conditions apply.

While wage advances are free, if you choose to have your Advance disbursed to your Gusto Spending account instantly, you will be charged a $4.50 fee. This instant transfer fee will be charged to your Gusto Spending account at the time of disbursement. Instant Transfers typically occur in seconds, but may take up to 30 minutes.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240716722142/en/

Press Contact:

press@getclair.com

Source: Clair

FAQ

What is the new partnership between Clair and Gusto for On-Demand Pay?

Clair has partnered with Gusto to offer Embedded On-Demand Pay to employees at many of Gusto's 300,000 supported businesses. This allows employees to access a portion of their earnings daily through the Gusto Wallet app.

How does Clair's Earned Wage Advance (EWA) work with Gusto Wallet?

Clair's EWA is integrated into Gusto Wallet, allowing Premium members to see how much of their paycheck they can access, withdraw a portion of their earnings daily, and automatically repay the advance when their next paycheck arrives.

What are the benefits of Clair's On-Demand Pay for Gusto Wallet users?

Gusto Wallet users can access their earnings daily without a credit pull, avoid interest charges, and automatically repay advances with their next paycheck. This helps employees cover unexpected expenses and improve financial wellness.

Why did Gusto choose Clair as their On-Demand Pay partner?

Gusto selected Clair out of nearly a dozen on-demand pay solutions due to its compliance framework and technical capabilities. Clair's partnership with Pathward®, N.A. allows for bank-issued EWAs with no interest.