Salarium’s troubles: A fintech startup’s fall from grace

In a shocking turn of events, the once mighty FinTech startup Salarium has suspended its operations indefinitely in the Philippines as of 31 December 2023. The payroll services company cited in an email sent to its clients and users ongoing issues that severely impacted its ability to function effectively. Salarium vaguely referred to an unspecified incident on 18 December 2023, without providing details about the nature of the problem. They also mentioned that due to a lack of operational staff, all customer data would be deleted and inaccessible during the suspension period. The company expressed apologies for the inconvenience caused to its clients and thanked them for their support over the years.

Using the email address posted on their website, I reached out to Salarium to clarify things about the suspension of their operations, however, my message bounced back to me. I also checked the company’s Facebook page and the last post dates back to 23 August 2023 with the comments section plagued with customer complaints. I still have to receive a response to my message sent via Salarium’s FB page.

Since August 2023, frustrated clients have taken to various social media platforms, including Facebook, X/Twitter, and Reddit, to vent their frustrations about Salarium. The primary complaint centered around users’ inability to access funds as their accounts were frozen by the platform. It was around the same month when Salarium’s SALPay (a payroll disbursement facility and eWallet service) suddenly went out of service. Clients have struggled to get answers from the FinTech company’s customer service, and many reported being unable to contact the company’s founder and CEO, Judah Z. Hirsch.

It may be recalled that Salarium raised several millions of dollars during its Initial Coin Offering (ICO) last November 2017, but the venture was shortlived and they offered to refund participants a year later.

Based on the company’s website, its clientele includes AFDigital, Denali Marketing, Vanguard Assessment, Xtendly Philippines, Manila Recruitment, 7-Eleven, Prescon Philippines, and AutoDeal.

Over the weekend, I spoke with one of their customers affected by this unfortunate incident, and this person said that their company is preparing to take Salarium to court, as their employees are already resorting to salary loans and their business reverted to manually distributing cash to compensate for the frozen payroll system.

Salarium’s fall from grace serves as a cautionary tale for FinTech startups, emphasizing the need for robust crisis management and transparent communication with clients during challenging times. As the situation unfolds, businesses affected by Salarium’s suspension grapple with financial uncertainties, and the broader FinTech community watches closely, evaluating the repercussions of this unfortunate episode.