How Can an Earned Wage Access Platform Help Your Business?

Earned Wage Access Platforms Improve Employee Retention and Morale

Earned wage access (EWA)  — also known as on-demand pay — gives employees access to their earned pay before the traditional, scheduled payday.

With an earned wage access platform employers can provide greater financial wellness support for employees, leading to happier and more productive employees across an organization.

DailyPay was among the early pioneers of earned wage access platforms dating back to 2015. Today, earned wage access has become a must-have employee benefit. In fact, 76% of workers across all age groups say it is important for their employer to offer EWA according to a 2022 ADP Earned Wage Access Market Research Study.1

As the popularity of earned wage access increases, so have the regulations. Nevada and Missouri both recently passed laws around licensing processes and guidelines for earned wage access.2

Earned wage access is a financial wellness benefit that lets employees choose when they get their earned pay instead of the traditional pay cycle.

This increased flexibility of their pay schedule allows employees to potentially improve their financial well-being and avoid predatory lending solutions that can damage their credit and rack up costly interest rates or other fees.

89%

of employees reported feeling more motivated and productive at work when they had access to their pay on their schedule.1

Today, it’s not a question of whether a company will adopt the benefit but when. 

According to Fisher Phillips, 89% of employees reported feeling more motivated and productive at work when they had access to their pay on their schedule.3

Due to this increased demand, more employers are considering earned wage access as a benefit for employees, many of whom want greater flexibility in how they are paid.

Earned wage access has a variety of benefits for both employers and employees. Let’s take a look at some of the ways each can expect to see some rewards. Additionally, there may be some perceived cons your company should consider when looking into EWA. 

Earned Wage Access Benefits for Employers

Aside from the employee desire for earned wage access, employers should recognize the benefits and consider how earned wage access will help their company overall.

63%

improvement in tenure rates by offering earned wage access.2 Higher retention rates can reduce the costs of back-filling positions and improve morale.

Increased Employee Retention
A DailyPay sponsored study from Mercator showed that earned wage access can improve tenure rates by 63%.4 Higher employee retention can reduce the costs of back-filling positions and improve morale.

Higher Employee Engagement 
Research sponsored by DailyPay found that when people worry about finances at work, they’re less engaged.5 An outstanding employee experience may help employees feel valued, engaged and supported leading to better employee retention.

Better Customer Outcomes
Employees who are more motivated, engaged and happy in their roles are more likely to deliver better experiences such as:

Earned Wage Access Benefits for Employees
Financial stress is one of the most common reasons for employee turnover. According to the 2022 PWC Employee Financial Wellness Survey, financially stressed employees are twice as likely to look for a new job.6 Employees struggling with financial considerations have higher stress levels,7 and this can negatively affect their morale and productivity. 

More Than

8 in 10

employers believe employee financial wellness programs and tools help to create more productive, loyal, satisfied and engaged employees.6

According to a 2020 study by SHRM, more than 8 in 10 employers believe employee financial wellness programs and tools help to create more productive, loyal, satisfied and engaged employees.

When selecting an earned wage access provider, evaluate various aspects of the experience for your company.

  • Consider the vendor’s experience when dealing with the regulatory environment.
  • Determine if the vendor has experience dealing with companies of your size and if they will meet your needs.
  • Ensure the earned wage access provider can help improve the overall employee experience.
  • Evaluate the security and privacy standards and how they protect sensitive information.

 

So how does on-demand pay from DailyPay stack up against other major earned wage access providers in the market?

The following table provides a fact-based evaluation of earned wage access vendors for your consideration.

earned wage access providers comparison

Sources: DailyPay; Payactiv; Branch; Ceridian
https://www.dayforcewallet.com/organization
https://www.ceridian.com/uk/products/dayforce/payroll/wallet-on-demand-pay
https://www.zdnet.com/finance/banking/ceridian-redefines-how-employees-get-paid-with-its-dayforce-wallet/

Getting started with earned wage access involves planning and collaboration across internal staff and your vendor. During the earned wage access implementation process you should consider vendor partnerships, industry requirements, security and more.

Luckily, the more established vendors like DailyPay make implementation simple and easy.

DailyPay has developed an integrated solution with many payroll providers, which may reduce the implementation time to two weeks. DailyPay will work with you throughout the implementation process to ensure a smooth adoption of earned wage access throughout kickoff, testing, transmission, training and launch.

Get More On-Demand Pay Insights.

As mentioned earlier, the increased popularity of earned wage access platforms has spawned the need for new regulations. Nevada and Missouri have both recently signed bills into law advocating for legislation and guardrails for earned wage access platforms. 

The recent development is that Nevada has passed and signed into law, with overwhelming bipartisan support, SB290 – the country’s first bill regulating earned wage access products. Soon after, Missouri became the second state to pass and sign EWA legislation into law. SB103 was passed with strong bipartisan support.

Both laws regulate EWA as its own financial product, codify best practices for the industry and ensure strong consumer protections. DailyPay was an active part of the broad coalition of stakeholders, which helped to develop and ultimately support both bills. DailyPay is proactively engaging with regulators in additional states, which are developing EWA regulation/legislation.

The Consumer Financial Protection Bureau (CFPB) issued advisory guidance in regard to EWA programs and whether the Truth in Lending Act (TILA) applies. According to the guidance, EWA programs can be distinguished from being considered credit. 

In the opinion, the CFPB indicates that programs that require an employee to pay back an on-demand transfer via a payroll deduction and charge fees may be considered extensions of credit.

The CFPB has noted that there is no extension of credit in the case of wage deductions only if there are no fees or other restrictions. DailyPay’s proprietary technology and use of the Non-Payback Model do not and have never relied on employee payback of funds via a payroll deduction or debiting of bank accounts (the CFPB’s analysis only clarifies information around these models — our model is and has always been in full compliance).

Key Takeaway #1

Utilizing debiting as a form of EWA payback is likely to be considered an extension of credit.

The CFPB approval order specifies a narrow set of circumstances in which the requesting entity, PayActiv, would be perceived as not issuing loans.


However, the order intentionally excludes providers that utilize debiting as for payback, suggesting that these types of providers are deemed to be extending credit. The order’s scope is limited only to states where wage deductions are legal. In other states, where debiting is the only form of payback that providers can leverage because wage deductions are illegal, the CFPB indicates that such situations present the perception of credit.

Key Takeaway #2

Debiting consumer bank accounts continues to be a dangerous and strongly disfavored practice, both by the CFPB and other state authorities.

The CFPB’s order adds certainty around an area that has been highly discredited by state and federal authorities for many years. As the hallmark of payday lending practices, debiting as payback is a predatory practice. The CFPB order adds validity to this and indicates that debiting as a form of payback is specifically associated with the extension of credit.

Key Takeaway #3

Wage deductions continue to be illegal at the state level in many states. DailyPay has led the industry for years, avoiding both dangers — debiting and wage deductions.

Even though the CFPB issued an EWA approval order, it does not eliminate the core compliance, tax and additional workflow implications caused by payroll deductions themselves (and, more importantly, the fact that laws in a number of states expressly restrict wage deductions). Regarding state prohibitions on deduction models, employers using wage deduction models to offer EWA benefits to their employees are still at risk of violating wage and hour statutes, Department of Labor rules, and other rules and regulations.

DailyPay continues to work proactively with regulators across the country, at the state and federal levels to encourage and develop a productive and thoughtful regulatory framework for the earned wage access industry. 

Our proactive regulatory work includes communicating the mutual benefits of EWA for both employers and employees:

With beneficial regulation passed and on the horizon, now is the right time for innovative companies to engage and deploy an earned wage access solution.

All information herein is for educational purposes only and should not be relied upon for any other use. The information herein does not constitute the rendering of professional advice by DailyPay. DailyPay does not warrant the completeness or accuracy of any information provided to you.

1 Source:ADP

2 Source:Payments Dive

3 Source:Fisher Philips

4 Source:DailyPay, 2021

5 Source:DailyPay, 2021

6 Source:Josh Bersin, 2021

7 Source:CNBC

8 Source:SHRM

9 Source:Payments Dive

10 Source:ADP

  • What is earned wage access?

    Earned wage access is a financial wellness benefit that lets employees choose when they get their earned pay instead of the traditional pay cycle. Read more about what earned wage access is.

  • Is earned wage access the same as on-demand pay?
  • Which companies offer earned wage access? How does my company get earned wage access if we don’t currently have it?
  • How much does it cost to sign up for earned wage access?
  • Is earned wage access the same as a payday loan?
  • Why should a company offer earned wage access to their employees?
  • What is the difference between earned wage access and early wage access?
  • What is “On-demand payroll” and is this the same as “earned wage access”?
  • Is “earned income access” the same as “earned wage access”?
  • Are there fees associated with earned wage access?
  • What are earned wage access apps?
  • What is earned wage access software?
All information herein is for educational purposes only and should not be relied upon for any other use. The information herein does not constitute the rendering of professional advice by DailyPay. DailyPay does not warrant the completeness or accuracy of any information provided to you.

See Why Top Companies Choose DailyPay

Empowering for Employees

Greater financial control with access up to 100% of their DailyPay balance to meet the challenges of unexpected financial disruptions.


Improved planning with visibility to spending and earned pay in one easy-to-use app.


No need for a pre-existing checking or savings account.

Simple and Secure for Employers

Minimal change to payroll processes — DailyPay handles it all.


Seamless integration with HCM, payroll, banking and benefit applications.


Enterprise-grade platform that keeps data private and the service running so it's always there when your employees need it.