It is often the assumption that bad habits are started with earned wage access (EWA) but far from the truth. EWA doesn’t encourage bad habits, but it does prevent bad situations. EWA is an on-demand pay solution that allows employees to access their earned but not yet paid wages before payday, all through an app.  We believe there is value in responsible, yet flexible, EWA solutions and these solutions can better the financial health of employees.

Our current data shows that 22% of employees use EWA each pay period, with an average of $130 of earned pay accessed. This indicates that those who turn to EWA are using it for small expenses that are off-rhythm from their standard pay period – not frivolous spending. Think about how often a bill does not line up perfectly with payday such as an electricity bill falling on the 12th of the month. Without EWA, these same employees would be forced to turn to high-interest payday loans, indubitably leading to long-term financial burdens.

Predatory interest rates, overdraft fees, and late fees add to daily financial stresses, potentially affecting an employee’s mental health and workplace performance, and permanently affecting credit scores which impacts an employee’s financial freedoms. These crippling cycles of debt can be stopped with a simple solution that is free for employers to offer.

Immediate understands employers concerns around wanting to ensure their employees still receive a paycheck when payday comes around. This is why we believe in doing the research and choosing the most responsible solution for your business. Through the Immediate solutions, we allow employers to customize the standard guardrails we have in place – for example, setting a max EWA withdrawal of 50% of earned wages. 

For more information check out our blog “Making the Case for EWA” or if you have questions, book a 15-minute discovery call.

Written by: Mason Beard, CSO