Labels like Warp and Ninja Tune will now get paid when people stream their music from the service.

SoundCloud has just struck a deal with global music rights agency Merlin, which means the music of 20,000 independent labels and distributors will be legally available on the service.

“When we started SoundCloud in 2007, one of our chief priorities then, as it remains today, was championing independent artists,” the company said in a statement. “The indie community has always been at the heart of SoundCloud, and our deal with Merlin is another way for us to further support the independent community by opening a new source of revenue for them.”

The deal means that Merlin is now part of On SoundCloud, the programme announced last year that introduced advertising as a means of paying royalties to labels. Labels and groups represented by Merlin include Warp, Ninja Tune, PIAS, Beggars Group, Domino, Secretly Group and Epitaph.

The news comes at a tough time for SoundCloud, which has struggled to reach terms with certain labels in an attempt to legitimise the service. Last month Sony started pulling its catalogue from the service, while a recently leaked contract showed its plans to introduce subscription tiers to generate more revenue.