As employees now change jobs more frequently than ever before, staff retention has become crucial for boards, and employers are increasingly offering rewards as a way to boost loyalty and engagement within their workforce.
Whilst there has been an emphasis on employee benefit schemes that offer private healthcare and dental care, subsidised gym memberships, and life assurance, one huge factor has been largely under-invested in – the financial health of staff.
With 17 million UK employees (40% of the working population) having less than £100 in savings, the UK is facing a savings crisis. Leading employers are recognising the need for socially-conscious benefits and some now offer solutions to help transform their employees’ financial health, which, in turn, bolsters engagement and effectiveness at work.
This need for investment in the financial wellbeing of staff has seen SalaryFinance, an employee benefits business that specialises in technology to help employees consolidate debt and start saving, complete a £40 million funding round (subject to Financial Conduct Authority approval).
The round was led by FTSE 100 financial services firm, Legal & General, with founding investor Blenheim Chalcot, the UK’s leading digital venture builder, participating.
Asesh Sarkar, CEO of SalaryFinance, commented: “We looked far and wide for the right investment partners who share in our focus on business with social purpose, and we are delighted to have Legal & General on board alongside Blenheim Chalcot.”
Worries around workforce retention are well-founded, with UK workers changing jobs every five years, according to research from life insurance firm, LV =.
As millennials enter the workforce and crave more than stability and a golden goodbye gift when they retire, this job movement is only increasing, with some employees leaving within 18 months to two years of employment.
As senior executives and hiring managers see more of their top people leave the business after significant investment in them, they are beginning to understand the need for benefits that have tangible, impactful results.
It’s this realisation that has propelled SalaryFinance to become one of the UK’s fastest-growing employee benefits businesses, and this new round of investment demonstrates a growing recognition of how financial concerns impinge on work and life, and the potential of workplace benefits to improve the lives of employees.
Sarkar went on to say: “This investment marks the completion of the first phase of our long term plan, proving that finance can be delivered in a socially progressive way.”
Enabled by this funding, SalaryFinance has launched its Financial Wellbeing Hub, a suite of financial education, products and services that enables employees to make a positive change to their monetary circumstances in two key ways: first, by helping them better understand their financial situation through educational content, budgeting tools and credit score checks; second, by enabling people to improve their finances through salary deductible savings and low interest loans.
With the UK positioned as a world leader in workplace financial wellbeing, SalaryFinance plans to expand from its London headquarters to the US, taking the societal benefits it is delivering in the UK, to other countries with a similar need.
The platform is available to employers at no cost or liability.
Calling SalaryFinance’s approach “technology first, customer centric,” Bernie Hickman, CEO of Legal & General Insurance, continued: “Financial wellbeing lies at the heart of Legal & General’s business…I am excited by the opportunity to work in partnership with SalaryFinance to broaden out and scale up this already successful and socially useful business, improving the financial wellbeing of many more people.”
Dan Cobley, Chairman of SalaryFinance and partner at Blenheim Chalcot, said: “Blenheim Chalcot is delighted to partner with Legal & General in the next phase of growth for SalaryFinance, another exciting fintech business that began life in our Hammersmith venture builder.”