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Isn’t it strange that the modern on-demand trend hasn’t reached the payroll department? Almost everything imaginable is available when and where people want it in 2023, but there’s no “same-day” shipping for a worker’s paycheck. At least, there hasn’t been until now. 

Earned Wage Access (EWA) is a revolution in action. No matter the name people give it — some call it payments on demand — the basic premise remains the same: It’s possible to give workers access to the money they’ve already earned before their scheduled payday. 

Most companies haven’t started doing this yet. But for those that do, the benefits can be exceptional. Worker retention benefits, improved productivity, better quality candidates — all these and more are attainable by companies that implement an EWA program in their business. Let’s see why. 

What Is Earned Wage Access? 

As the name implies, EWA lets employees access their already earned wages early. The more usual way of doling out payroll is at rolling intervals, either twice or once a month. It’s a time-honored system that most companies still abide by. It would have been too hard before the advent of today’s payment systems for even a small company to offer payroll on demand, never mind major corporations trying it. 

But modern payment systems are in place now. Businesses do have the capacity to grant employees access to a part of their income on the very day they earn it, using payment processing and custodial tools like: 

  • Electronic payments delivered to prepaid debit cards held by the employee
  • ACH direct deposits sent directly to the employee’s bank account
  • Digital wallet solutions, such as Apple Pay, that the employee can use with whatever vendors accept them

EWA provides employers a way to increase their collaboration with employees. In an era when financial stress levels constantly reach new heights, granting workers immediate access to their earned salary becomes a much-needed bonus. These are neither loans nor cash advances. Employees only receive on demand the money they’ve already worked for. 

What’s the benefit for the company? Why, worker satisfaction, of course. Study after study shows how employee satisfaction is the essential ingredient in workplace productivity, particularly in terms of professional performance and morale. High job satisfaction levels help employees work harder, stay with the company longer, and take an active interest in the company’s success. 

EWA can function as a self-service payment vehicle for companies. Business owners can automate the transfer of on-demand payments to their workers, ensuring fast access and easy receipt of funds. Modern payroll systems also carefully document these transfers to fulfill the company’s reporting requirements, helping it stay in compliance with government regulations. 

This purges companies of their need to micromanage every single payment detail. EWA payments work as “fire and forget” mechanisms that nevertheless remain in the system, whose records stay accessible as needed. And since companies no longer bear the full brunt of payment adjustment requirements, EWA is a cost-effective measure as well. 

How Does EWA Benefit Employees? 

The average employee has only ever known the world of on-demand services, but they’re still accustomed to antiquated payment schemes. Companies that offer EWA benefits can take a giant leap ahead of their competitors: They’ll entice more qualified candidates, they’ll execute more efficient business operations, and their employees will serve customers better. 

And they’ll achieve those goals because of their happier, more productive employees. See, employees love receiving EWA. It grants them a host of financial incentives that other payment models struggle to compete with. 

Immediate Access

64% of American workers were living paycheck to paycheck at the start of 2023. Waiting for a biweekly paycheck, to say nothing of a monthly one, can put intolerable stress on a company’s workers. They’ll put on a brave face, but the wait can feel interminable when old bills and sudden expenses collide. This situation can change dramatically just by receiving EWA. 

Employees who can access their pay when they need it, under the circumstances of their choosing, will undoubtedly remember the employer who relieves them from their anxious days of waiting. EWA places them in immediate control of their finances, affording them a financial benefit they wouldn’t find at another job. And that has a radical impact on employee retention. 

Financial Security

Inaccessible money causes much trouble. Someone forced to wait for their money, even money already earned, must necessarily seek other options. And where will they look first? To high-interest rate credit cards, payday loans, and other specious sources of support. This has a detrimental impact on their long-term financial security, and that, in turn, has a detrimental impact on their ability to work successfully. 

EWA helps avoid these and other lamentable circumstances. Employees receive peace of mind instead of mounting concerns. They can tap the money they’ve already invested their time and effort into earning, securing it for their purposes as conditions allow. And, once again, they’ll think twice before moving to another employer who may deprive them of EWA. 

Budget Planning

Earned Wage Access simplifies an employee’s budgeting as well. That immediate infusion of their hard-earned cash lets them project their future spending with far greater precision and even discernment. They can fund their savings account or pay off that abrupt medical expense as the situation allows. 

Employees can also: 

  • Stay up to date with their spending
  • Pay their credit cards or other liabilities on time, avoiding late payment penalties that could hurt their credit score
  • Invest their earnings more wisely, using stocks, bonds, or some other vehicle that can advance their personal financial goals

Accessing their funds right away can also offer an unmistakable feeling of reassurance. Instead of resorting to the credit card to make that child care payment, employees can just transfer money from the company’s EWA system. Such a simplified process only benefits everybody. 

Why EWA Use Will Increase in 2023

Recent economic headwinds have led to a pronounced labor shortage around the country. It’s getting “harder to find good help nowadays,” as they say, and that’s putting pressure on employers to step up their hiring game. Offering major benefits, such as Earned Wage Access, is a great way to do just that. 

The emphasis and advantage in the labor market has fallen on the employee side. With more labor demand than there is supply, qualified candidates are free to play the field when looking for a new employer. They’ll shop around, keep their cards close to their chest, and make a final decision based on their personal profit motive. 

That means employers must offer more enticing employment benefits if they expect to win professional hearts and minds. When a company wants to attract higher-tier talent, what do they do? They offer: 

  • More flexible working hours. New hires can align their personal and professional schedules more closely together. 
  • Broader healthcare benefits. That enhanced coverage is often all it takes to persuade someone to choose one company over another. 
  • More generous retirement plans, such as elevated employee match rates or other financial benefits. 

And it goes without saying that EWA is another tool in the arsenal of available benefits. New financial technologies, such as digital wallets or online banking applications, make on-demand payments more readily accessible than ever before. Even large corporations can implement EWA into their payroll systems with relative ease, and that means its usage will continue to grow. 

It’s possible to automate these payments and take a hands-off approach to the entire process. Employees can schedule their own EWA payments in accordance with their specific needs, giving them the freedom to use their money at will. Employers are also fast recognizing the ability of EWA to promote fiscal health for their workers, making other companies more likely to start their own EWA solutions. 

EWA doesn’t interfere with existing payment infrastructure. A company reliant on traditional payroll schedules can continue using them alongside EWA for special cases among its employees. The two payment models complement one another handsomely, allowing most workers to continue their habituated schedules while giving those who need an alternative the ability to take it. Such a system elevates the sense of cooperation between the employer and employee, making them feel like one cohesive unit. 

With benefits like that, it’s no wonder EWA has taken off like it has. The labor market is entering a more, lacking a better phrase, “human-centric” era, where sheer profit margin takes a back seat to financial wellness — a holistic rather than itemized standard. Employees expect more from their jobs, employers want to do their part, and the amplification of EWA across the nation is the likely outcome. 

Preparing for the Future of EWA 

It seems EWA is here to stay. Employers looking to expand their hiring options could do a lot worse than offering potential employees early access to their salaries. It’s a much appreciated gesture, but let’s not confuse this with charity. Employers benefit from the increased productivity, making it a beneficial outcome for everyone involved. It’s just a more efficient use of payment architecture. 

Businesses interested in starting their own EWA programs should consult the experts at Resourcing Edge before they begin. Although EWA makes for a simple transition, there are some hurdles along the way that are better managed together. Visit our site and sign up to receive a free consultation. 


Earned Wage Access: Tapping Into the Potential Benefits of Flexible Pay In Today’s World of Work 

Employment Rate in the United States From 2000 to 2022, By Age

Why Earned Wage Access Is Critical for Employees and Businesses

Even on $100,000-Plus, More Americans Are Living Paycheck to Paycheck

Labor Shortages Forecast to Persist for Years

Jami Beckwith

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