Trust Center

Complying with the law and keeping your data safe are our top priorities. Our earned wage access program is compliant with local, state and federal regulations, and our security and data protection measures are designed to keep your data safe and protected.

Find the information you need on security, compliance, regulations, privacy, and data processing here.

The highest safety and security

Information Security

We maintain and implement an Information Security Program, which establishes proper policies, procedures and standards in accordance with PCI/SOC/ISO controls to help protect the confidentiality and integrity of all information and data we collect and store.

Privacy Policy

We take the privacy of our users seriously and comply with all applicable privacy laws.

Data Processing Agreement

We are compliant with the California Consumer Privacy Act and adhere to safe and secure data processing standards.

Confidentiality

We’ll protect your confidential information. Contact your sales representative to execute our Confidentiality Agreement.

Good for people and businesses alike

B Corporation

As a Public Benefit Corporation and Certified B-Corp, consumer protection and social responsibility are at the heart of our mission. We adhere to the highest standards of public transparency, legal accountability, and fair and transparent pricing. 

Compliance Handbook

Our EWA program is carefully designed to comply with consumer protection standards as well as state and federal wage and labor laws. Compliance is our commitment.

Recent policy and regulatory updates

Wisconsin Governor Signs Earned Wage Access Legislation

Wisconsin Governor Tony Evers signed into law legislation that creates a new license for earned wage access (EWA) providers in the state. The bill received broad bipartisan support in the Assembly and Senate, and was signed into law on March 21, 2024 by the Democrat governor. The bill creates a new license for EWA providers, which will streamline the onboarding process for Wisconsin employers to readily identify which providers are licensed in the state.

Nevada Enacts First EWA Bill and Confirms EWA Is Not a Loan

On June 13, 2023, Nevada Governor Joe Lombardo signed into law the first-in-the-country EWA bill – a bipartisan effort that creates numerous consumer protections and confirms EWA is not a loan. Payactiv strongly supported this regulation, as it provides regulatory certainty for the industry while allowing room to innovate and grow, and confirms that EWA does not fit into traditional lending frameworks.

Payactiv Becomes Registered EWA Provider in Missouri

Payactiv recently became one of the first registered EWA providers in Missouri. The new EWA registration system encodes into law many of the best practices that exist in the industry today, including ensuring EWA will always be non-recourse and that there will never be any interest, late fees, penalties, underwriting, or credit impacts. Through the new registration, Payactiv is compliant with all relevant laws and regulations in Missouri.

Montana Attorney General Affirms EWA is Not a Loan

Montana Attorney General Austin Knudsen recently stated in the Montana Administrative Register that EWA products are not loans so long as the EWA product is fully nonrecourse; does not condition a transaction on any interest, fees, or other consideration or expenses; and limits transactions to income already earned by the consumer. Payactiv’s EWA program is fully compliant with these parameters.

Arizona Attorney General

On December 18, 2022, Arizona Attorney General Mark Brnovich issued an Opinion on EWA confirming that non-recourse EWA products that do not levy a “finance charge” are not considered consumer loans and are not subject to licensure as commercial lenders in the state. While the Opinion does not address any specific EWA programs by name, Payactiv’s EWA program fits squarely within this framework as a no-interest and non-recourse EWA product that does not impose a finance charge.

California Department of Financial Protection and Innovation

On January 14, 2021, Payactiv entered into a Memorandum of Understanding with the California Department of Financial Protection and Innovation that establishes industry-best practices and enables the Department to understand the benefits that Payactiv’s market-leading earned wage access (EWA) solution offers to California consumers. The MOU incorporates Payactiv’s consumer protection guardrails—including its industry-low cost, accessible balance limits, and program fee caps—and will give the DFPI data demonstrating Payactiv’s positive impacts on California workers. The MOU is one of several that the department has entered into with EWA providers as part of its broader effort to evaluate the EWA industry.

Legal FAQs

Read the most commonly asked questions about our Earned Wage Access program

Payactiv relies on factoring to provide cash without a loan or credit. Factoring allows one party to transfer the risk of non-payment of a receivable to another party. Payactiv introduced factoring, long a feature of commercial agreements, to EWA. By relying on factoring to provide cash to its users, Payactiv assumes the risk of nonpayment of wages, while the user obtains funds without the need for a payroll advance or loan. Factoring is recognized in every state, and numerous courts have held that factoring transactions are not loans if the funding entity has no recourse and bears the risk of loss.

Yes, we always obtain written authorization for payroll deductions. Payactiv obtains written consent from employees each time they perform an EWA transaction and authorize a corresponding payroll deduction. Payactiv’s deduction model not only complies with state and federal wage and labor laws, but maximizes clarity and efficiency for both the employer and employee. Regulators and legislators have expressed a clear preference for settling EWA transactions by payroll deduction.

Neither the employer nor employee are liable if there are insufficient funds to deduct on payday. On rare occasions, the EWA amount, and applicable fees, cannot be fully settled through a payroll deduction because the employee received insufficient net wages due to wage garnishment, lien, or other deductions. Payactiv’s Program Terms and Conditions provide that Payactiv may re-present such a failed deduction on subsequent paydays if necessary, but neither the employee nor the employer have any independent obligation to repay Payactiv if the attempted deduction or debit fails due to the unavailability of funds.

In addition, there is no inability-to-pay risk with Payactiv EWA transactions. Any risk an employee’s next paycheck will be insufficient to settle the EWA transaction is borne entirely by Payactiv, not the employee. Further, an employee may revoke their deduction authorization without any penalty or fee.

No, authorized deductions for EWA transactions do not trigger wage assignment or wage discounting laws. In general, a wage assignment occurs when the employee pledges future earnings against a present debt obligation. In other words, an assignment of wages provides collateral for an underlying loan or credit transaction, giving the lender a right to seize wages in the event of a default. Some states prohibit wage assignments because they can be associated with abusive lending practices and harmful consequences for the employee, like sacrificing an entire paycheck to cover a debt. These concerns are not an issue with the Payactiv model, which does not rely on a wage assignment.

Statutes governing wage assignment transactions usually focus on whether the debtor “assigns future wages to the creditor in the event of default.” Payactiv does not do this: we do not issue debt, deal in unearned/future wages, or most importantly, reserve recourse rights against the user. Payactiv’s Terms & Conditions confirm these principles, and disclaim any wage assignment or debt of any kind.

Payactiv’s EWA program also does not trigger “wage discounting” laws, which generally prohibit employers from imposing conditions or obstacles which interfere with or prevent an employee from promptly receiving their due wages. To the contrary, Payactiv does just the opposite, eliminating obstacles that interfere with or prevent an employee from promptly receiving their earned wages. To be clear, Payactiv does not act as a payroll provider, and does not discharge the employer’s wage payment obligations; employees are never required to utilize the benefit or pay a fee to obtain their wages. In addition, employees can always receive their paycheck at no cost through the normal payroll channel.

No. Federal tax law requires employers to withhold certain items from employees’ wages and comply with other income tax requirements when they pay their employees. The employer’s withholdings obligations are not triggered by Payactiv’s EWA program because Payactiv does not disburse wages themselves to EWA recipients. Instead, Payactiv purchases a right to a future receivable from the employee, and, in exchange, the employee receives the value of the future receivable — the EWA amount. As for the employer, it is not a party to this factoring transaction between Payactiv and the employee, nor is the employer advancing unearned wages, which the IRS has treated as taxable compensation, for services yet to be performed by the employee.

On payday, the entire wage payment is calculated by the employer and disbursed: Payactiv collects a portion of the wage payment through a deduction file submitted to the employer pursuant to Payactiv’s agreements with both the employer and the employee (end-user). From the employer’s perspective, withholdings are calculated based on the entire wage payment amount as normal, including any amount disbursed to Payactiv. The earlier EWA payment does not involve an employment relationship and is not an actual payment of wages. Accordingly, the employer is not required to process withholdings any differently with Payactiv.

Yes, Payactiv stands by every aspect of its Program and backs up its claims with contractual indemnification for its employer clients. We will indemnify clients for all claims related to the normal operation of the services, which include EWA transactions, the resulting deductions, and compliance with related state and federal law. Clients can rest easy knowing that Payactiv provides a safety net for any claims related to the program, however unlikely.

No. Other EWA providers force the employee to open a separate “for-benefit-of” or “FBO” bank account where the employee must deposit 100% of their wages as a pre-requisite to participate in an EWA program, even if they do not use it.  FBO accounts give the provider 100% control over both the account and the employee’s paycheck, and create unique compliance risks like wage assignments. In addition, the net amount displayed on the worker’s paystub does not match the amount deposited in the user’s personal bank account on payday. Employees must therefore discover any errors themselves, without the benefit of a statement. And payroll departments may not have any record of the amount of any EWA transaction either. This can cause unnecessary confusion for the employer and employee, as well as for lenders or others who may need to rely on employee bank statements to verify income for other reasons.

By contrast, Payactiv’s EWA offering is a true consumer-friendly, non-recourse transaction. We are guided by what is best for the employee—the worker always comes first, and always has the right to receive their unpaid, earned wages directly from the employer.

No, Payactiv’s payroll deductions do not implicate federal or state minimum wage laws.  Payactiv simply allows the employee to receive their pay ahead of the employer’s regularly scheduled payday. The offset on payday for such early-accessed amounts does not reduce the employee’s pay below minimum wage; in other words, the employee is still being paid the same rate. 

In any event, minimum wage calculations are generally made before withholdings and deductions. Under the federal Fair Labor Standards Act (FLSA), an employee may voluntarily authorize an employer to perform a deduction, even if the deduction takes the employee’s wages below minimum wage. State laws generally treat the issue the same way, and allow for deductions like Payactiv’s that are approved by the employee in writing and are for the employee’s benefit.

No, Payactiv’s payroll deductions do not trigger bank-imposed NSF (non-sufficient funds) or overdraft fees. When Payactiv debits the employee’s card for any reason, it relies on merchant debit, which is better for the consumer and does not trigger such fees.