Fintechs focus on gig workers to expand their reach

Gig workers and freelancers represent a growing portion of the workforce, but they usually don't qualify to get financial products like insurance, home loan, credit cards, among other things. This is because companies usually evaluate the financial profile of borrowers with the help of salary slips, tax returns, bank statements, and other income documentation.

Given that the vetting process is thorough, many times it poses a significant challenge for gig workers as well as freelancers to reach out to the formal financial sector. Realising the gap, many fintech companies have now started tapping this market and providing solutions, which otherwise was difficult for someone without a regular salary.

Consider Onsurity, an employee healthcare platform. It is using a blend of technology and innovation to provide affordable healthcare solutions in the form of sachets to gig workers.

"With the post-pandemic recovery in action, the status of gig workers does not have to lie in obscurity with Onsurity's employee health membership plans. The plans are extremely affordable and have the convenient option of paying on monthly basis but there is more for gig workers. Once a member wishes to exit their organisation, they can continue the Onsurity membership which helps to save them up to 50 per cent (of premium)," Onsurity founder Yogesh Agarwal says.

Gig workers are generally online platform workers, temporary workers, contract-firm workers, among others. They enter into formal agreements to provide services to clients of on-demand companies.

"That's not all, we also offer a personal purchase option for other family members to be included in the plan. The services that help maintain workers' physical and mental health are a lifeline to small businesses that cannot afford to lose key workers at this point. We have already plugged a gap by offering coverage to this group in the first place, have sprung into further action to support customers and non-customers alike," Agarwal adds.

Getting a loan can also be almost impossible for someone without a regular salary and employment contract. Banks either don't serve this market at all, or it takes several years to prove income levels and qualify for financing.

Another company helping gig workers in their financial journey is Tartan. The company helps users connect their employer-linked payroll or HR management system (HRMS) account to any app or business and verify their income and employment status. Tartan's solution also helps the underserved and unbanked by leveraging their income and employment data. It especially benefits low-salaried individuals, freelancers, social media creators and gig workers who usually have low or no credit score and are considered as 'new to credit' customers.

"We have integrated with a few delivery apps which contract about 1 million gig workers in India. In the gig economy, which claims more than one-third of Indian workers, companies like Swiggy, Ola, the Urban Company are disrupting traditional service models of retail, logistics, transportation, and even technology. Fundamental aspects of work like the notion that there's a 40-hour workweek, the notion that there's overtime, these concepts about employees or contractors -- all these notions that we think are very normal are actually just about 50 years old," Tartan CEO and co-founder Pramey Jain says.

According to a report by Morgan Stanley, 50 per cent of all global workers will participate in freelance and gig economy in some capacity by 2027. Whether to be their own boss and set their own schedule; to earn more income to support themselves and their family; to have more flexibility to balance life, family and other commitments; or to maintain a steady cumulative income because other sources are unpredictable or unstable, there are many reasons why people are increasingly attracted to a non-traditional, gig-based career comprised of various projects and assignments, rather than a 9-5 office job.