Fintech Industry Praises Missouri Law on Earned Wage Access

Legislation codifies fintech lending practices

A trade association representing so-called "fintech lenders" is cheering the passage of legislation in Missouri that codifies industry practices and creates a regulatory framework for Earned Wage Access (EWA) products.

The American Fintech Council (AFC) says the new Missouri law, signed by Gov. Michael Parsons, will provide consumers with more choices in the small-dollar lending market.

“As one of the first states in the nation to embrace regulatory standards for the EWA industry, Missouri is at the forefront of responsible innovation creating access to safe financial services,” said Phil Goldfeder, Chief Executive Officer of the American Fintech Council. “Missouri families should have the ability to access the wages they have already earned from responsible companies that are providing an alternative to high-priced payday and other predatory options.” 

A pair of Earned Wage Access providers says the new law will protect consumers while allowing the companies to conduct business in Missouri.

“Payactiv is proud to support this high-standard bill, which creates new consumer protections for Missourians and a strong framework for the EWA industry to continue to innovate and grow,” said Molly Jones, Vice President of Government Affairs at Payactiv. “As the second bill to pass this year, it is clear that policymakers across the states have recognized EWA is a unique, innovative financial product that does not fit into legacy frameworks and requires its own registration or licensing system.”

“DailyPay is proud to be part of the broad coalition supporting the latest bipartisan earned wage access law enacted in Missouri on July 6th,” said Ryan Naples, Director of Public Policy at DailyPay. “As with Nevada’s first-in-the-nation EWA licensing law that was similarly bipartisan and signed in June, the Show Me State’s SB 103 also regulates EWA as its own financial product that includes strong consumer protections.”

Earned wage products are offered through employers and allow workers to access an advance on upcoming wages which is repaid on the next pay date. Consumer advocates have expressed concern about the products creating a cycle of borrowing. Industry representatives such as AFC say the new rules will protect consumers.

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