Can earned wage access help employees manage debt?
Instant access to salaries is a productive lifeline for debt-stressed workers.
Steep rises in living expenses are pushing more South Africans towards debt, with employees and employers experiencing more negative consequences. For employees, it’s the stress of growing debt and seeking higher-paying jobs, and for employers, the resulting absenteeism, lack of focus, and poor retention as financial worries overwhelm their people.
For many, payday cannot come soon enough. According to Debt Busters, 57% of people in debt counselling rely on payday loans and 22% regularly use overdrafts. Credit cards and buy-now-pay-later (BNPL) loans also increase debt burdens, and the most desperate turn to illegal “loan shark” lenders. Consequently, the average South African can be spending over half of their income just to settle debts.
There are several ways to tackle these challenges, including debt counselling, financial literacy, and savings vehicles. A new and surprising option has joined that list: Earned Wage Access (EWA).
“Earned wage access lets employees immediately access portions of wages they have already earned,” says Bruce van Wyk, CEO Deel Local Payroll. “It’s a relatively new innovation made possible by modern payroll platforms that integrate with financial service providers. It delivers quick access to money for employees who interact directly through their banking app or a USSD service, and employers can manage withdrawals by setting limits.”
The impact on debt
Since employees access a portion of money they have already earned, EWA (also called on-demand pay) is not a credit product and doesn’t require credit checks. The service integrates through a payroll platform with banks, so employers don’t have to manage requests and paperwork. This streamlined access helps employees access cash for emergencies or basic costs.
“If your car breaks down, your child needs to go to the doctor, or you’ve run out of groceries, you can’t wait days or weeks for your salary to arrive. That is usually when people take on debt, and if they are in a really urgent situation, they might turn to faster but less legal or more punitive arrangements. Earned wage access gives them access to money that is already theirs.”
Some criticise EWA on the assumption that easy access to cash will only lead to spendthrift behaviour and smaller pay cheques, thus aggravating debt situations. But studies into EWA systems are finding the opposite results.
The International Labour Organisation notes that EWA can enhance workers’ financial well-being and “provides greater convenience and a sense of privacy and dignity compared to borrowing from family, friends, or employers.” Many employees who use EWA experience no rises in overdraft debts or debt interest, at the least showing that EWA doesn’t contribute to debts. The most common uses for EWA withdrawals include paying for rent, utilities, fuel, prescriptions, auto repairs, and credit card payments.
“Earned wage access isn’t a silver bullet. It could lead to irresponsible spending, though the consequence is a smaller pay cheque, not a mountain of debt that keeps growing,” says Van Wyk.
There are also early but positive signs that EWA can support debt-management plans by providing strategic liquidity, something employees appreciate. According to the 2025 Deel Australia Payday Expectations Report, three-quarters of surveyed employees want their employers to offer financial-wellness resources.
Should companies use EWA?
EWA is relatively new, first emerging in 2012. There are still some concerns around its use, such as fees charged by some services or financial institutions. The overall impact on employees’ financial wellness is also still a mixed picture, though those with access to coaching, financial literacy resources, and financial goal-setting see the most benefits.
Employers are worried that EWA means more bureaucracy or other costs to them. But organisations that use leading payroll platforms with seamless integration features enjoy EWA as a low-impact, high-result investment. It also positively affects employee well-being and loyalty.
“Choosing the right EWA provider is important,” says Van Wyk. “You want a payroll platform with the right capabilities and a payroll service provider who is transparent and knows how to integrate these systems for a seamless experience. But the merits of EWA are too strong to ignore, especially in debt-laden societies. It’s a way for employers to support their people in positive ways during tough times.”
