Amid stubborn inflation and rising costs of living, 61 percent of Americans live paycheck-to-paycheck – which increases to a whopping 78 percent of workers for those earning less than $50,000 a year. Without an emergency fund, unexpected expenses that arise between paychecks, like a child’s doctor visit or a flat tire, can be devastating for workers and their families.
For these workers, earned wage access (EWA) is a critical tool for employees to access money they have already earned when they need it, which can make all the difference during a family emergency to prevent going into cycles of debt. In fact, nearly 15 percent of employers now offer EWA to their employees so that they have access to this table stakes employee benefit.
To better understand how consumers are using EWA, Payactiv partnered with 60 Decibels to survey over 1,000 users. The survey results overwhelmingly show that users allocate their EWA for livelihood needs.
These findings underscore that EWA is a critical resource for workers who are living paycheck-to-paycheck to help make ends meet, as well as the fact that users make responsible decisions about what is best for them and their families. Accessing their own, already earned wages also helps workers avoid high-cost interest products, like payday loans, online payday loans, and title loans that often trap them in cycles of debt.
State and federal policymakers have an opportunity to permanently encode best practices and consumer protections related to this essential service. States like Nevada and Missouri have recently created a licensing system for EWA providers that ensures there is never any recourse, interest, late fees, penalties, underwriting, or credit impacts for workers as they access their earned wages.
About the 60 Decibels Methodology
In February 2023, 60 Decibels conducted online surveys with 1,006 Payactiv users. Online surveys can introduce bias by selectively sampling from certain populations, resulting in a non-representative sample and potentially skewing the results.
Here is the breakdown of how 60 Decibels collected the data:
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