Castor raises $1.8 million to offer pay-on-demand

Photo by Castor

In a bid to increase banking penetration in Latin America, Mexican fintech company Castor closed a $1.8 million pre seed round, adding up to a total $64.4 in funding, according to Crunchbase.

This round was led by Canary, Vast Venture, Latitude, and First Check Ventures, as well as angel investors such as Daniel Vogel, CEO of Bitso.

The new capital will be used to accelerate Castor’s growth in the region, as it plans to reach other countries in early 2022. Castor’s main goal is to be a global provider of pay-on-demand, or daily access to worked wages, by 2023.

Castor offers salary on demand

It is very common to hear people not being able to make ends meet before their next paycheck. For some, the easiest thing to do would be to use a credit card, but this is not the case for half of Latin America. Literally, more than 50% of the region’s population is unbanked.

Castor’s target market is people who don’t have access to financial services and are struggling with making ends meet each month. To them, the fintech company offers pay-on-demand; or free and instant access to their worked wages instantly.

“We want to bring tools that allow users to better manage their money and have the peace of mind to provide for their families,” said Diego Villarreal, co-founder, and CEO of Castor in a press release.

Even more financial services for the unbanked in 2022

So far, Castor’s main product is free and instant access to salary on-demand through a Mastercard.

By their first quarter in 2022, Castor will offer automated savings and utilities payments with cashback program.

To do this, the employee’s salary will be transferred to the card everyday, so they can manage and access their salary on a daily basis instead of waiting for the full paycheck at the end of the month.

There are other strong competitors catering to this same market, including Mexico City-based company minu.

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