77 pc Indian employees feel positive about earned wage access: Report

Earned wage access is a fintech product that enables employees to access a portion of their accrued but unpaid salary any time before payday.

While 77 per cent of respondents feel positive about this concept and are ready to evaluate its usage, 28 per cent said they would use an EWA product, according to a report 'Earned Wage Access in India: The final frontier of employee wellbeing' by EWA solutions provider Refyne in partnership with Ernst & Young. Notably, 59 per cent of respondents said they would consider EWA as a deciding factor for their next job, it added.

The report further discovered that the highest interest for EWA exists among the millennial employees with 77 per cent wanting to explore it.

“The need for a better quality of life, evolving mindset and impact of the COVID-19 pandemic is creating a fundamental shift in the way employees think about and manage their finances. “Employers have a critical role to encourage responsible and disciplined financial behaviour among employees. We believe that EWA can serve as a medium for employees' financial empowerment and nurture overall financial wellbeing in the long run,'' Refyne CEO and co-founder Chitresh Sharma said.

The report analyses employee and employer preferences towards EWA by surveying 3,010 employees across India.

The survey further revealed that inflation, job cuts, low salary hikes or a once-in-a-century pandemic like COVID-19 contributed to expenses getting ahead of salary, shrinking cashflow for employees. It discovered that 81 per cent respondents felt the need to have more money in hand during COVID-19.

Moreover, in the last six months, 73 per cent respondents not only faced unexpected expenses but were also unable to meet them with their salary. More than 80 per cent of respondents reported exhausting their salary before month-end, whereas 34 per cent ran out of their pay before mid-month, it stated.

Employees interviewed feel that EWA will help them with more liquidity to manage unexpected expenses, investment planning and improve their financial wellbeing, the report said. Over 38 per cent or nearly 4 in 10 respondents said they believe EWA will help them feel confident in managing unexpected expenses, and 34 per cent said it would help them invest or save more regularly, it added.