NEW YORK –
August 11, 2021 – Millions of American workers get caught in the vicious circle of debt from relying on payday loans and paying expensive overdraft fees to pay bills on time and make ends meet. However, according to a new study by the Aite Novarica Group, having access to your salary when you earn it can eliminate such financial crippling options in order to survive paycheck to paycheck for an overwhelming majority of people stuck with these predatory financial services. The study * confirms that DailyPay and its proprietary approach to on-demand pay (sometimes known as Access to Earned Wages), which gives employees easy and reliable 100% instant access to their funds, is a remarkably effective solution for expensive financial alternatives like payday loan is, overdraft fees, late fees and the like. Research also shows that DailyPay can end reliance on regular borrowing from friends to make ends meet, reduce financial stress, and improve overall financial wellbeing. Aite-Novarica found that using DailyPay improves workers’ financial results for a significant majority of users. More than eight in 10 (82%) of respondents who accessed their DailyPay balance on demand said they had been less worried about money since starting the program, and 75% said they had thanks to the option be able to access their income, budget better and plan on demand. And those numbers generally apply to those who pay on-demand more often, including those who use a larger percentage of their pre-payday salary, according to survey results. “Respondents used some costly and arguably inferior alternatives before gaining access to DailyPay,” said Leslie Parrish, senior analyst at Aite-Norvarica. “These consumers feel largely better informed about their finances after using DailyPay.” Key takeaways from the research report include:
- The vast majority of previous payday loan and overdraft users have moved away from this suboptimal behavior and most of them attribute this change to DailyPay.
- The Aite Novarica Group conservative It is estimated that frequent payday loan users with DailyPay save between $ 624 and $ 930 annually.
- 95% of those who previously relied on payday loans in some way have stopped using either payday loan (81%) or reduced usage (15%) after using DailyPay. Almost nine in 10 (88%) of respondents said they stopped or reduced their use of such loans because of DailyPay.
- The Aite Novarica Group conservative estimates that most DailyPay overdrafts save $ 660 annually.
- 97% of those who said they had overdrawn their bank account prior to using DailyPay now rarely or never incur overdraft fees (79%) or report that they experienced fewer overdraft fees after using DailyPay (18%). 75% have credited DailyPay with this reduction in overdraft fees.
- DailyPay users also report that they can better manage their bills and loan payments, and reduce the need for help from friends or family.
- 88% had fewer problems with bills and loan payments after using DailyPay.
- 94% will credit DailyPay for this change to make / settle loan payments.
- DailyPay has consistently reaped positive results for users as the product has made them less worried about money (82%), improved budgeting and planning skills (75%), and enabled them to reduce debt (60%) and those who use DailyPay relatively more often report even higher average savings and an even broader prior reliance on inferior, predatory alternatives.
“This data is transformative and supports a very important conclusion – DailyPay is helping working Americans stay debt free,” said Mattew Kopko, vice president of public policy, DailyPay. “DailyPay removes 4 out of 5 payday loan or overdraft users from the debt cycle, with most of the remaining 20% experiencing significant financial benefits. People clearly say they need this simple and reliable service to make ends meet. ”For a more detailed look at the study, visit http://www.dailypay.com/aite-report.
* Industry leader DailyPay has partnered with Aite-Novarica Group, a respected financial industry research and advisory firm focused on financial matters, to conduct independent research on its customer base with on-demand payments.
Aite Novarica’s online survey of 1,114 DailyPay customers was conducted in May 2021. 95% confidence interval with 3-point margin of error
About DailyPay: Powered by its industry leading technology platform, DailyPay is on a mission to build a new financial system. Working with America’s top employers including Dollar Tree, Berkshire Hathaway, and Adecco, DailyPay is the recognized gold standard for on-demand payments. Through its vast data network, proprietary financing model, and connections to over 6,000 endpoints in the banking system, DailyPay works to ensure that money is always in the right place at the right time for employers, merchants and financial institutions. DailyPay builds the technology and mindset to rethink the way money moves from the moment work starts. DailyPay is headquartered in New York City and based in Minneapolis. Visit www.dailypay.com/press for more information. About Aite-Novarica Group: Aite-Novarica Group is a consulting firm that provides business-critical insights into the technology, regulations, strategy and operations they support to hundreds of banks, insurers, payment service providers, and investment firms, as well as technology and service providers. Our experts, comprised of former senior executives in technology, strategy, and operations, as well as seasoned researchers and consultants, provide actionable advice to our customer base and leverage deep insights gained through our extensive customer network and other industry contacts. Visit us on the web and connect with us on Twitter and LinkedIn.