News & Resources


APA Engages With House Financial Services Committee on EWA

BY: Mike Linehan | 12/17/21

The APA submitted comments to Congress on earned wage access (EWA) following a hearing of the House Financial Services Committee’s Task Force on Financial Technology in November. During the hearing, representatives questioned witnesses about consumer protections, which employees may benefit from EWA, and whether EWA is different from a payday loan.

APA Provides Insight on EWA

The APA acknowledged the need to balance consumer protections with employee financial choices and the prevention of predatory practices while making available less-costly options for paying bills between pay periods. The APA provided Congress with its EWA report prepared by members participating in the Government Relations Task Force Early Wage Access/On-Demand Pay Workgroup. As EWA technologies have matured, more employers are offering these benefits to their employees.

Congress Considers EWA

Consumer interests on the panel during the hearing said that EWA is an end run around payday loan laws, while business interests stated that because the wages were already earned, they are not payday loans. The Truth in Lending Act (Regulation Z) defines payday loans but does not consider EWA. Thus, the existing requirements are not directly applicable. The APA said that all EWA programs offered to employees through employer-provided benefits must consider wage and hour laws, federal and state tax requirements, child support and garnishments, and other withholding requirements.

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Mike Linehan is the Assistant Manager of Government Relations for the APA.