Clair Raises $175M With Pathward to Launch Free On-Demand Pay Solution
On July 6, 2023, fintech company Clair announced it had raised $175 million to launch a free on-demand pay solution for front-line workers, powered by its partnership with Pathward, an FDIC-insured bank. The product enables workers to access earned wages before payday at no cost, with Pathward providing up to $150 million in participation for the wage advance facility. Clair's solution is built on embedded banking infrastructure, integrating directly into employer payroll and workforce management systems.
The offering differentiates itself from competitors by eliminating fees typically associated with earned wage access products. Pathward serves as the banking partner providing the regulated financial infrastructure underlying the service. The funding positions Clair to scale its embedded finance product across a broader range of employers and workforce platforms.
The partnership exemplifies the BaaS model where a regulated bank enables a fintech to deliver financial products to end users through embedded integrations.
- Validates the embedded payroll finance model as a major growth area within BaaS, attracting significant capital
- Pathward continues to expand its role as a leading BaaS bank partner across multiple fintech verticals