Improving the Financial Health of Gig Workers with Innovative Financial Solutions

In partnership with APEC Malaysia 2020, Bank Negara Malaysia (BNM), the Malaysia Digital Economy Corporation (MDEC) and the United Nations Capital Development Fund (UNCDF) launched the Financial Innovation Gig Economy Challenge in March 2020 – an initiative that calls for the submission of innovative solutions to improve the financial health of gig economy workers. The Financial Innovation Gig Economy Challenge was funded by MetLife Foundation through the i3 (Innovate, Implement and Impact) Program.

Based on findings from the World Bank, Malaysia has a growing gig economy with 26 percent of its workforce being self-employed or operating independently. Much of this is driven by the on-demand gig economy, where a substantial portion of work is found through ride-hailing and food-delivery services. The gig economy is characterised by flexible working hours and greater employee autonomy. However, the short-term and non-binding nature of the relationship between the platform operators and its employees can be challenging for gig workers. 

The Challenge is in line with Malaysia’s focus under the APEC Finance Ministers’ Process on mitigation and recovery measures in light of the COVID-19 pandemic. It seeks to leverage digitalisation to support business viability and promote sustainable economic recovery. The Financial Innovation Gig Economy Challenge received more than 100 submissions globally. From that, 10 teams were chosen to participate in an intensive, eight-week bootcamp and innovation programme, with Malaysia serving as a testbed to refine these emerging ideas to improve the financial health of gig workers in the Asia Pacific region.

Over the course of the programme, the companies were accorded various support to enrich their solutions, including insights on the gig economy in Malaysia, human-centred design tools, access to industry players and mentoring from respective subject matter experts. During the final round of pitches, an esteemed panel of judges selected the top three solutions that would receive further support from UNCDF to test and scale their solutions with gig workers in Malaysia.

The three solutions were PAY:WATCH, Versa and GetHyred, all of which were selected based on the potential to improve employability and financial health among gig workers, through innovative means such as app-based training modules, income smoothing solutions and accessible savings instruments.

As finalists, PAY:WATCH, Versa and GetHyred were given the opportunity to showcase their promising solutions at the APEC Virtual Finance Ministers’ Meeting (AVFMM) on 25 September 2020. A brief description of the winning solutions is as follows:

• PAY:WATCH partners with employers and banks to provide workers instant access to earned wages, in real time, before pay day. By providing gig workers with access to low-cost financing from major reputable banks, PAY:WATCH minimises the likelihood of gig workers having to turn to informal lenders.

• Versa is a digital cash management platform that provides returns on par with Fixed Deposits, but with similar liquidity as a Savings Account. This helps gig workers get the best out of their idle cash responsibly, while meeting liquidity needs.

• GetHyred is launching a gig marketplace coined as “Zasss” to match young gig workers to income-generating opportunities. Zasss complements a myriad of skill-building platforms established by GetHyred that encourages young gig workers to develop a variety of skills and expertise.

APEC 2020 Malaysia 

Bank Negara Malaysia 

Malaysia Digital Economy Corporation 

United Nations Capital Development Fund 

2 November 2020

About APEC Malaysia 2020

The Asia-Pacific Economic Cooperation (APEC), is a regional economic forum of 21 members, established in 1989. Its formation leverages on the growing interdependence of the Asia- Pacific, with the primary goal of promoting free trade and sustainable development in the Pacific Rim economies. 

Malaysia is one of the founding members of APEC in 1989, alongside 11 other economies, namely Australia, Brunei Darussalam, Canada, Indonesia, Japan, the Republic of Korea, New Zealand, the Philippines, Singapore, Thailand and the United States. China; Hong Kong, China; and Chinese Taipei joined in 1991. Mexico and Papua New Guinea followed in 1993. Chile acceded in 1994. And in 1998, Peru; Russia; and Vietnam joined, taking the full membership to 21. 

Malaysia’s hosting of APEC 2020 is themed ‘Optimising Human Potential towards a Resilient Future of Shared Prosperity: Pivot. Prioritise. Progress’. At the national level, the three priority areas are improving the narrative of trade and investment;inclusive economic participation through the digital economy and technology; anddriving innovative sustainability. 

About Bank Negara Malaysia (BNM)

Bank Negara Malaysia (BNM) was established in 1959, under the Central Bank of Malaysia Act 1958 (Revised in 2009). BNM is principally entrusted to uphold monetary and financial stability and maintain oversight over the payments system in the country. BNM has overseen the development of a comprehensive, efficient and resilient financial sector, contributing to economic growth and development. 

As part of its mandate, BNM is committed to evolving well-designed regulations for innovation in financial services, while ensuring that the associated risks are well-managed. This includes a focus on uplifting financial inclusion among consumers, including the gig economy. Further information on Bank Negara Malaysia and its developmental efforts may be found at https://www.bnm.gov.my/

About Malaysia Digital Economy Corporation (MDEC)

Malaysia Digital Economy Corporation (MDEC) is a government agency under the purview of the Ministry of Communications and Multimedia Malaysia entrusted to lead Malaysia's digital economy forward. Incorporated in 1996 to oversee the development of the MSC Malaysia initiative, MDEC's primary mandate today is to accelerate the growth of digitally-skilled Malaysians, digitally-powered businesses and digital investments in Malaysia. MDEC is focused on creating inclusive, high-quality growth through the nationwide digitalisation initiatives that are in line with the Government’s Shared Prosperity Vision 2030 and firmly establishing Malaysia as the Heart of Digital ASEAN.

#LetsBuildTogether #DigitalMalaysiaForward 

To find out more about MDEC’s Digital Economy initiatives, please visit us at https://mdec.my/ or follow us on: 

Facebook: https://www.facebook.com/MyMDEC/

Twitter: @mymdec 

About MetLife Foundation 

At MetLife Foundation, we are committed to expanding opportunities for low- and moderate-income people around the world. We partner with nonprofit organizations and social enterprises to create financial health solutions and build stronger communities, while engaging MetLife employee volunteers to help drive impact. MetLife Foundation was established in 1976 to continue MetLife’s long tradition of corporate contributions and community involvement. From its founding through the end of 2019, MetLife Foundation provided more than $860 million in grants and $85 million in program-related investments to make a positive impact in the communities where MetLife operates. Our financial health work has reached more than 13.4 million low- and moderate-income individuals in 42 countries. To learn more about MetLife Foundation, visit metlife.org. 

Metlife Foundation’s i3 Program (Innovate, Implement, and Impact) works in Bangladesh, China, Malaysia and Vietnam to uncover deep insights into low- and moderate-income (LMI) people’s needs, aspirations and behaviours in order to build and deliver financial services for the mass market. LMI people have limited options that could drive usage of formal financial services and so struggle to manage their limited resources and cash flows. To learn more about the i3 Program, visit https://www.i3program.org 

About UNCDF

The UN Capital Development Fund (UNCDF) makes public and private finance work for the poor in the world’s 47 least developed countries. With its capital mandate and instruments, UNCDF offers “last mile” finance models that unlock public and private resources, especially at the domestic level, to reduce poverty and support local economic development. UNCDF’s financing models work through two channels: financial inclusion that expands the opportunities for individuals, households, and small businesses to participate in the local economy, providing them with the tools they need to climb out of poverty and manage their financial lives; and by showing how localised investments—through fiscal decentralisation, innovative municipal finance, and structured project finance—can drive public and private funding that underpins local economic expansion and sustainable development. By strengthening how finance works for poor people at the household, small enterprise, and local infrastructure levels, UNCDF contributes to SDG 1 on eradicating poverty and SDG 17 on the means of implementation. By identifying those market segments where innovative financing models can have transformational impact in helping to reach the last mile and address exclusion and inequalities of access, UNCDF contributes to a number of different SDGs. For more information visit https://www.uncdf.org/

Bank Negara Malaysia

02 November 2020

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