Lengthy-time readers will know I like earned wage entry (EWA). I believe it is likely one of the handiest fintech improvements in shifting the needle on monetary well being.
Payday lending turned widespread primarily as a result of employers tied up their workers’ wages, solely releasing them on payday. That’s rapidly altering.
First, it was Nevada, then got here Missouri, and now Wisconsin turns into the third state to enact laws regulating EWA. Governor Evers signed Meeting Invoice 574 into legislation earlier this week. The brand new legislation creates a regulatory framework for EWA that was supported by the American Fintech Council in addition to business chief DailyPay who launched this announcement right now.
The bipartisan invoice creates a licensing regime inside the Wisconsin Division of Banking as soon as the invoice goes into impact in six months.
Within the absence of any political will on the nationwide degree to deal with this crucial challenge, it’s as much as the states to take the lead.
As soon as everybody has entry to their earned wages each time they need, we are going to dramatically scale back the demand for payday loans. And that may result in a big enchancment in general monetary well being.
Look out for a deeper dive into the regulation of earned wage entry by Tony Zerucha coming shortly.
