How EWA can kickstart employee financial security

• Key insight: Discover how earned-wage access transfers short-term liquidity responsibility to employers.
• What's at stake: Employers face higher absenteeism, turnover costs, and operational risk without liquidity solutions.
• Expert quote: Fred Choquette - Majority live paycheck-to-paycheck; access to earned wages provides critical cash stability.
  Source: Bullets generated by AI with editorial review

As daily living costs beleaguer workers, eliminating the wait for a paycheck may improve employees' financial health. 

More than half (52%) of employees cited cost of living as their biggest economic concern in a recent survey by PwC. Those dealing with financial stress are five times as likely to be distracted at work and spend more than three hours of their workweek dealing with this issue, the research found. 

"The majority of households in the U.S. are living paycheck to paycheck, so what you have is a workforce that is financially stressed at all times, because you don't know if any type of emergency is going to happen, and simple things like filling up your car and buying groceries have significantly increased," said Fred Choquette, chief operating officer at earned wage access (EWA) platform Rain.

Rain integrates with a company's payroll and gives participating employees access to a portion of their earnings before their regular paycheck arrives. Wages are trackable and transferrable to a Rain Visa Debit or other linked card, or a separate bank account. Instant transfers carry a small fee, and one- to three-day transfers are free. 

The platform also has a spending tracker, budgeting assistance, savings and credit-building tools, and AI-powered bank-account monitoring that helps users avoid overdraft fees. Its customers span multiple industries and include companies such as McDonald's, Marriott and Toyota.

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It's a system set up to cover three tiers of financial health, Choquette said: Stabilizing finances, building financial literacy, and growing savings and credit. Right now, he noted, many employees are in need of help with the first area, and they're looking to their employers for resources.     

"We track all expenses and all spending on the Rain card, and the top three use cases are gas, groceries and bill payment," Choquette said. "People are using it for daily necessities — your employees just want it to survive day to day."      

3 steps to better financial health

"If you really want to have lasting impact and add hundreds of dollars back to your employees pockets every year, you have to start thinking about how to move them from this system where they're paying really high predatory fees like account fees, overdraft fees, late-payment fees, unsecured loans, credit card interest, and payday lenders, and move them to a place where they have access to their cash when they need it and avoid all of those fees for free," Choquette said. 

He outlined how EWA helps employees establish financial confidence. 

Stabilization
Establishing a more secure financial situation begins with stability — this equates to "even if you don't have a ton saved, you have access to the money you've earned if you need it," Choquette explained. 

"We see 50% of people — 85% of highest-use workforces — checking the Rain app every single day. They're not transacting every day, but they're checking because they just want to know, if I have an emergency, do I have this money available to me. That is the number one piece … this peace of mind," he said. 

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Control
Knowing access to cash is available, employees are now less stressed and can focus on expanding their financial education, Choquette said.

"Let's get you in a place where you can learn about what tools are at your disposal, like basics of a budget and thinking about putting some money away so you don't have to rely on a short-term liquidity tool, which is earned wage access," he explained.   

Growth
This is the part of the journey where employees move into long-term wellness by building savings and credit, Choquette said. 

"Once we've got you stable, you're no longer in a place of stress, so you're open to new ideas. [This is where they need] access to tools that allow them to grow and finally build that nest egg over time," he said.

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The ROI for employers

For businesses, the return on a more financially sound workforce is present in data. According to Rain's analysis of its employer customers, employees using the benefit versus those who are not, on average, have a 49% increased retention rate after six months and work an average of 20 hours more per month, Choquette said. The increased time isn't due to extra shifts, he added, but to people being absent less. 

Employers carry a lot of sway with their workforce, Choquette said, and offering a benefit like EWA is a free way to improve employees' lives while enhancing their ability to show up and perform — a true win-win.    

"It's important for employers to do this because they have employees' attention, and what they do and say has a lot of impact," he said.