Earned wage access (EWA) allows employees to access their accrued wages before payday and is evolving in response to changing regulations that aim to enhance consumer protections and provide clearer operational guidelines. Recent legislation in Arkansas and Utah, along with federal discussions regarding the Consumer Financial Protection Bureau's (CFPB) proposed interpretive rule, continue to influence the industry's direction.
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Legislative actions developing for years
Considerations for choosing a provider
Legislative actions developing for years
Jared DeMatteis, Chief Legal & Strategy Officer at DailyPay, recently shared insights on the potential impacts of these changes on EWA providers, employers, and workers. “Regulatory conversations at the state and federal levels began more than five years ago,” DeMatteis noted. “While this activity is not new, it is significant that states are now finalizing their own frameworks to regulate EWA as a distinct financial product.” He emphasized the importance of allowing sufficient time for this legislative work, as a careful and measured approach can lead to more effective outcomes.
Recent state developments
In 2025, Arkansas enacted the Earned Wage Access Services Act, which requires providers to offer at least one no-cost option and prohibits fee-sharing agreements with employers. Utah has also introduced requirements for EWA providers, including annual state registration and transparent fee disclosures. DeMatteis pointed out that Arkansas’ law will strengthen relationships between providers and employers while enhancing regulatory clarity. He noted that Utah’s measures align with consumer-oriented best practices already adopted in various jurisdictions, such as California. “EWA providers in California have been required to register with the state for the past couple of years under a memorandum of understanding,” he explained.
Federal action and inaction
At the federal level, discussions around the CFPB’s proposed interpretive rule remain a critical focus for the industry. This rule, aimed at classifying EWA products under the Truth in Lending Act, has been stalled since early 2025. DeMatteis remarked that the Biden Administration’s inaction, along with the previous Trump Administration’s decision to freeze the proposed rule, is not surprising. He stated that this response mirrors the actions of states — regardless of their political affiliations — that have enacted EWA laws or finalized related regulations.
Advocating for regulations that establish tailored best practices, DeMatteis emphasized that EWA products do not share key characteristics of traditional loans, such as interest rates, credit approvals, late fees, and risk-based pricing. He asserted that the CFPB’s proposed interpretive rule was incorrect and stressed the need for regulations at both state and federal levels that accurately define EWA as a unique financial product, as several states have already done.
Considerations for choosing a provider
When selecting an EWA provider, DeMatteis advised employers to seek solutions that foster mutual success for both employees and businesses. He suggested practical strategies for seamless integration across different systems, ensuring quick implementation while minimizing disruptions to payroll processes and teams, thereby allowing these processes to continue operating without significant changes.
