Earned Wage Access Providers: What to Consider When Choosing a Provider

When selecting an Earned Wage Access (EWA) provider, also referred to as On-Demand Pay providers, the decision goes beyond simply choosing a service that allows employees to access their earned wages before payday. The right provider can enhance employee satisfaction, reduce financial stress, and strengthen the company's values and operations. However, there are key elements you must consider to ensure you’re partnering with a responsible and suitable provider.

Membership of Earned Wage Access Code of Practice

The Earned Wage Access Code of Practice is a critical benchmark for identifying responsible Earned Wage Access providers. Created to establish industry standards, this code is designed to ensure fair and transparent practices. Partnering with a provider that adheres to this code ensures that they follow ethical rules and prioritise the financial well-being of employees.

Why it matters:

Earned Wage Access providers adhering to the Code of Practice are committed to essential principles such as protecting employees from hidden fees and providing full transparency about terms and costs.

When choosing an Earned Wage Access provider, check their website or directly ask if they are a member of the Earned Wage Access Code of Practice. This membership not only reinforces their ethical commitment but also protects your company’s reputation by ensuring your employees are treated fairly.

Overall Offering

The services offered by Earned Wage Access providers vary significantly, and it’s crucial to examine their overall offering to ensure alignment with your company’s values and goals.

Some providers offer debt-related products alongside their Earned Wage Access services. While this might sound like added value, it’s essential to consider whether promoting debt options aligns with your organisation's ethos. Businesses focusing on employee wellbeing may prefer providers such as Level, which emphasise not offering any debt products to your staff.

Promoting a debt-free model fosters financial empowerment instead of dependency, giving employees a system to build healthier financial habits.

Certain providers offer additional features like financial wellness tools, budgeting tips, or savings options to complement their Earned Wage Access services. These extras enhance the employee experience, making financial security easier to achieve.

Automated vs Manual Reconciliation

Efficient reconciliation processes are another critical factor. Reconciliation in Earned Wage Access ensures that the wages accessed early are accurately deducted from the employee’s earnings, freeing businesses from payroll errors.

Earned Wage Access providers typically offer one of two options, and sometimes both:

Automated Reconciliation

This hands-off approach integrates the reconciliation process seamlessly into payroll operations, saving time and ensuring accuracy. For growing businesses or those with lean HR teams, automated reconciliation is a game-changer.

Manual Reconciliation

This approach is ideal for businesses that prefer internal oversight or customising reconciliation schedules to meet specific requirements.

Level stands out as one of only two providers offering both automated and manual reconciliation, providing maximum flexibility for employers. This diverse approach ensures businesses can operate with efficiency without sacrificing control, making Level a strong contender if flexibility is your priority.

Relevant Fees

Transparency is critical for understanding the costs associated with Earned Wage Access providers. Fees can vary widely between providers, so it is important to ask about these when you have a demo.

Businesses should prioritise fully transparent providers who clearly articulate their fee structures. Be sure to evaluate how the fees align with the quality of service offered. 

Summary

Choosing the right Earned Wage Access provider is an impactful decision that directly affects both your employees’ financial wellbeing and your organisation's efficiency.

For businesses looking for responsible and effective Earned Wage Access solutions, providers like Level stand out due to their adherence to ethical practices, versatile debt-free offerings, and clear transparency on fees and processes.