If you go to work every day, why don’t you get your paycheck immediately? Chana Schoenberger and Kate Fitzgerald at American Banker’s Bankshot podcast look at a new type of payday advance that sprung up in recent years known as earned wage access and talk to NCLC’s Lauren Saunders about who benefits and how when workers get paid faster.
“In general, I think that earned wage advances are not a helpful financial product. Their premise is you can’t afford to pay something out of this week’s paycheck, so I’m going to take from next week’s paycheck. It’s immaterial the fact that you worked those hours. You are not entitled to your pay until payday, so it’s an advance on your pay. And what happens is, you end up with a gap in the next paycheck, which causes you to have to borrow again, and you end up on an even more vicious cycle than traditional payday loans.”
Lauren Saunders, associate director at the National Consumer Law Center
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