Rain Named Workday Services Partner

Rhea-AI Summary

Rain, an employer-sponsored platform providing earned wage access (EWA) and financial wellness services, has announced a partnership with Workday (NASDAQ: WDAY). This collaboration will allow Rain to leverage a direct API integration with Workday Human Capital Management (HCM) to offer Workday customers a streamlined EWA experience. Rain's EWA program enables employees to access a portion of their earned wages before payday, potentially saving them millions in overdraft fees and payday loan interest.

Key highlights:

• Employees using Rain in 2023 estimated to have saved $51 million
• Customers offering EWA with Rain saw up to 2x more job applications
• 49% increase in retention after eight months on average
• Rain has onboarded over 2 million employees since 2019
• Distributed over $1 billion in wage advances
• Secured $116 million Series A funding in March 2023

Positive

• Partnership with Workday (NASDAQ: WDAY) to expand customer base
• Direct API integration with Workday HCM for streamlined service delivery
• Estimated $51 million in customer savings from avoiding fees and high-interest loans in 2023
• Up to 2x increase in job applications for customers offering Rain's EWA
• 49% average increase in employee retention after 8 months
• Over 2 million employees onboarded since 2019
• Distributed over $1 billion in wage advances
• $116 million Series A funding secured in March 2023
• $300 million credit facility from Clear Haven Capital Management

Negative

• None.

Insights

Financial Analyst

Rain's partnership with Workday marks a significant step in expanding its earned wage access (EWA) services. The integration with Workday's HCM system could potentially accelerate Rain's growth by tapping into Workday's extensive customer base. This move aligns with the increasing demand for financial wellness solutions in the workplace, especially given the current economic climate where 47% of Americans have $500 or less in savings.

The reported 49% increase in employee retention for Rain's customers is a compelling statistic that could drive adoption among employers. However, investors should note that while Rain has shown impressive growth - onboarding over 2 million employees and distributing over $1 billion in wage advances - the company is still in its early stages, having only been founded in 2019. The $116 million Series A funding and $300 million credit facility suggest strong investor confidence, but also indicate that the company is likely still operating at a loss as it focuses on growth.

HR Technology Expert

The partnership between Rain and Workday is a strategic move in the evolving landscape of HR technology. By integrating directly with Workday's HCM system, Rain is positioning itself to become a seamless part of the HR tech stack for many large enterprises. This could significantly lower the barrier to adoption for Workday's clients, potentially accelerating Rain's growth.

The reported increase in job applications (up to 2x) for employers offering EWA is particularly noteworthy in the current tight labor market. If these figures hold true across a broader customer base, it could make Rain's offering highly attractive to employers struggling with recruitment. However, it's important to consider that while EWA can provide short-term financial relief, its long-term impact on employee financial health is still a topic of debate among financial wellness experts. Investors should monitor how regulators view EWA services as the sector grows and matures.

Economic Analyst

Rain's partnership with Workday comes at a important time when inflation is putting pressure on household finances. The company's claim that its users saved an estimated $51 million in 2023 by avoiding overdraft fees and payday loan interest is significant, highlighting the potential societal benefit of EWA services. However, it's important to note that while EWA can provide short-term relief, it doesn't address the underlying issues of wage stagnation and rising living costs.

The growth of EWA services like Rain reflects a broader trend of financial innovation aimed at addressing gaps in traditional banking services. As these services gain popularity, they could potentially disrupt traditional payday lending and overdraft fee models, which have been lucrative for banks. Investors should watch for potential regulatory changes in this space, as well as how traditional financial institutions respond to the growing EWA sector. The long-term sustainability of the EWA model will depend on its ability to balance user benefits with profitability as the market matures.

LOS ANGELES--(BUSINESS WIRE)-- Rain, an employer-sponsored platform providing earned wage access (EWA) and other financial wellness services, today announced a signed partnership agreement with Workday, Inc. (NASDAQ: WDAY), a leading provider of solutions to help organizations manage their people and money.

Rain's EWA program allows employees to access a portion of their earned wages before their regular payday, providing them with financial flexibility and helping them avoid high-interest loans and overdraft fees.

Employees who used Rain in 2023 are estimated to have saved a total of $51 million by avoiding overdraft fees and the interest associated with payday loans. Customers that offer EWA to their employees with Rain have seen up to 2x more job applications and have reported a 49% increase in retention after eight months on average.

As inflation continues to have a significant effect on the economy, fewer middle-income households are confident about their ability to make payments, save, or plan large purchases. Nearly half of Americans have $500 or less in savings and spend billions on payday loans, high-interest credit cards, and other predatory financial products while waiting for their next paychecks. Rain’s EWA solution enables workers to access their wages before the official paycheck disbursement date, giving them control over their financial lives.

As a Workday Partner, Rain will leverage a direct API integration with Workday Human Capital Management (HCM) to provide Workday customers with a simple EWA experience, alongside fast and easy onboarding.

Workday HCM is a unified system that helps enable organizations to make faster decisions, gain operational visibility, prepare for future talent shifts, and build effective teams.

“Our partnership with Workday allows us to support its customer base by providing their employees with tools and resources that will help them achieve financial well-being. As workers continue to face challenges posed by the limitations of traditional pay cycles, we are looking forward to providing them with much-needed flexibility and relief. Additionally, we look forward to our EWA solution making a positive impact on employers’ potential for attracting and retaining talent and building stronger workforces,” said Alex Bradford, chief executive officer of Rain.

This partnership is the latest milestone in Rain’s expansion journey. Since its inception in 2019, Rain has onboarded over 2 million employees and distributed over $1 billion in wage advances. The company announced its $116 million Series A funding round in March 2023, which was the largest in HR tech history. Rain also secured $300 million in financing from Clear Haven Capital Management for a new credit facility. Recently, the company announced a partnership with global modern card issuing platform Marqeta to deliver more robust earned wage access solutions through embedded finance.

To learn more about Rain, visit www.rainapp.com.

About Rain

Rain is the trusted leader in employee-centric financial wellness solutions, serving middle-market and enterprise organizations nationwide. Through a comprehensive suite of offerings, including earned wage access and an array of financial wellness benefits, Rain seamlessly integrates into any organization’s existing infrastructure, providing the flexibility essential for effective financial management. Rain’s mission is to give employees greater control over their financial futures by eliminating the need for payday loans and other predatory financial products. Rain’s customers include global brands such as Hilton, McDonald’s, Marriott, and Subway and span various industries beyond restaurants and hospitality, including healthcare, retail, school systems, and non-profits. Visit www.rainapp.com to learn how to elevate your workforce’s financial wellbeing with Rain.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240916073493/en/

SourceCode Communications for Rain, 917.517.1104, rain@sourcecodecomms.com

Source: Rain

FAQ

What is the partnership between Rain and Workday (WDAY) about?

Rain has signed a partnership agreement with Workday (NASDAQ: WDAY) to provide earned wage access (EWA) services to Workday customers through a direct API integration with Workday Human Capital Management (HCM).

How much did employees save by using Rain's EWA service in 2023?

Employees who used Rain's earned wage access service in 2023 are estimated to have saved a total of $51 million by avoiding overdraft fees and interest associated with payday loans.

What impact has Rain's EWA service had on customer companies' recruitment and retention?

Customers offering Rain's EWA service have seen up to 2x more job applications and reported a 49% increase in employee retention after eight months on average.

How much funding did Rain secure in its Series A round in March 2023?

Rain secured $116 million in its Series A funding round in March 2023, which was reported as the largest in HR tech history.

How many employees has Rain onboarded since its inception in 2019?

Since its inception in 2019, Rain has onboarded over 2 million employees and distributed over $1 billion in wage advances.