Earned wage access (EWA), also called on-demand pay, has been available for years to help employees get access to their pay when they need it—even if that’s before payday. Some of the providers of these solutions have been around for more than 10 years, but sizing the market has been difficult, especially because there isn’t a repository of employee data that can help to guide projections.
The American Payroll Association (APA) completed an employee survey and released some data points on how many employees have EWA and those who have an interest in it. One key point is that just over 7% of employees say that they have EWA available to them. Here’s an excerpt from an announcement that the APA publishes about the report:
“Twenty-one percent of employees in America want access to their wages as they earn them rather than waiting for a traditional payday, according to the results from the 2022 ‘Getting Paid In America’ survey conducted by the American Payroll Association (APA) during National Payroll Week.
The annual APA survey asked, ‘Would you like access to some or all of your wages on-demand as you earn them instead of waiting for payday?’ Approximately 5,566 respondents (21%) to this question indicated this is a benefit they already receive or would be interested in receiving.”
Brian Slowik, co-founder of rapid! and the senior vice president of wage and corporate disbursements at Green Dot said, “Many employees are being paid electronically, and it is an extremely safe and convenient way to be paid. But nothing is perfect, and the current inflationary conditions have put extra pressure on employee’s mental and physical health and well-being. The need to have immediate and convenient access to your earned wages has never been greater.”
EWA is an emerging tool for employees. The payment method enables employees to access a portion of their wages as they earn them, rather than waiting for a traditional lump sum payment on a designated payday.
The “Getting Paid in America Survey” also discovered that 72% of Americans are living paycheck to paycheck. EWA can assist employees in meeting their financial commitments.
To see the results from the broader study that covers other topics about how employees are paid, click here.
Overview by Sarah Grotta, Director, Debit and Alternative Products Advisory Service at Mercator Advisory Group.