New Fintechs Target Acute Financial Needs

On Nov. 1, 2025, about 42 million Americans were cut off from their monthly allocation of food stamps when the federal government shutdown extended past the one month mark.

The Sunday before aid dried up, Catherine Scagnelli was sitting at home wishing she could help. Then she realized she could.

Scagnelli is head of marketing at Canary, a fintech that helps employers and nonprofits provide emergency funds to people in need. Employers raise cash for a charitable fund for their workers through Canary’s Grant Circle platform. Employees facing a financial emergency can apply for money online; if approved by Canary, the funds are dispersed from that pool, typically within one week.

On the Monday before the federal benefits expired, Scagnelli proposed adding a new emergency category—SNAP Crisis Response—alongside those already in place on its platform, including natural disasters and medical crises. By Friday, Canary had approved the category, set up the platform, and allowed people to request funds starting Nov. 1. About one-fifth of Canary’s clients used the option, offering help to employees who had lost their benefits.

“Employers don’t always want to believe that their people are facing these issues,” Scagnelli says. “And people don’t really want to tell their employer they are on the verge of being evicted or can’t afford groceries. But the top three expenses people need help with year over year are housing, food, and utilities.”

The financial wellness market is growing quickly, estimated to rise from $2 billion in 2022 to $7 billion by 2032.

Traditional financial wellness benefits have existed for centuries. Businesses offered pensions in the 1800s; profit sharing and health insurance were born in the 1920s; and tax law changes in the late 1970s created 401(k) plans. But the industry only began moving toward offerings like financial education and financial coaching over the past 15 years. The newest tools, like those to help with immediate financial needs, have grown in recent years.

While new vendors are rapidly developing innovative financial wellness products, experts say employers should ramp up their core, traditional benefits before bringing on shiny new products.

Employees Are Struggling

In Bank of America’s 2025 Workplace Benefits Report, more than half of the nearly 1,000 employees surveyed nationally didn’t have sufficient emergency savings—mostly because they were living paycheck to paycheck or working to repay debt.

The U.S. Federal Reserve said last year that about 37% of Americans could not pay an unexpected $400 expense with cash, savings, or a credit card they could pay off the next month. About 18% of adults said they could only manage an expense under $100 using savings, according to the Fed’s Report on the Economic Well-Being of U.S. Households in 2024-May 2025.

A 2023 PricewaterhouseCoopers survey found that 60% of full-time workers were stressed about their finances. That extended well beyond low-wage workers; almost half of surveyed employees making at least $100,000 a year said they were under financial stress.

“If you take a random sample of 100 middle- or high-paid employees, you will find 10 to 15 that are struggling financially despite getting better wages—and it’s usually for things invisible to employers,” says Mathieu Despard, clinical professor at the University of North Carolina at Chapel Hill’s School of Social Work. “Their spouse may have a major illness like cancer, or someone may have lost their job. Or they may have a past credit problem and have limited access to loans.”

Nonetheless, Despard says employers concerned with their workforce’s financial well-being should absolutely focus on low-income workers, whose families almost certainly struggle the most. Despard recently co-authored a report that found that about 25% of the U.S. workforce makes $35,000 or less. Nearly half of these workers are between 35 and 64 years old, meaning many are in what should be their prime earning years.

Financial stress can undermine a person’s health. It’s understandable that people with no money to spare are more likely to put off seeing doctors, scheduling necessary tests, and paying for prescription medications.

But there is also a more physiological link between financial and physical wellness. A 2024 study in the journal Brain, Behavior, and Immunity found that people under stress can experience a complicated physical response that disrupts the immune, nervous, and endocrine systems. Researchers studied nearly 5,000 people over four years and tracked the following stressors: divorce, caregiving, financial strain, chronic illness, disability, and bereavement. At the end of the study, they measured participants’ levels of things like cortisol and C-reactive protein (a protein made by the liver that can indicate high levels of inflammation). People with high levels of inflammatory markers were considered to be at higher risk for health issues including cardiovascular disease, depression, and premature aging. Of all the stressors measured in the study, financial strain was the most likely to put people into the high-risk group (followed by chronic illness and bereavement).

Research on links between physical health and financial stress is slight. But there is a significant amount of research on the connection between finances and mental health, particularly depression. A 2024 TIAA Institute study on employee financial and mental well-being noted that high amounts of debt and the inability to pay bills are associated with depression, anxiety, hopelessness, strained relationships with family and friends, and feelings of inadequacy.

Paying A Living Wage

It’s not always obvious in the workplace when people are having money problems. But some signs can point to financial challenges, according to Scagnelli. Employers can look for an increase in 401(k) hardship withdrawals, decreased employee productivity, delayed retirement, increases in absenteeism, and higher use of employee assistance programs.

The TIAA Institute report, for example, said workers dealing with financial stress miss about twice as many days a year than co-workers who are more financially sound. In a 2024 survey of 750 workers, fintech SoFi reported that almost half reported issues with sleep and mental health because of financial issues. More than one-third struggled with motivation and 26% had to take a second job because of finances. The employees also reported spending eight hours on the job each week dealing with their finances; one-third said financial issues impacted their focus; and another quarter said financial struggles decreased productivity and confidence at work.

Employers seem to understand the issue—80% of those surveyed for the Bank of America report said financial wellness resources help attract top talent and increase employee satisfaction and productivity. Just over half of larger employers surveyed, and 32% of smaller employers, said they provide these programs. Of the employer respondents, fewer than one-third offer debt assistance aside from student loans and 39% offer small emergency loans. The employers reported focusing more on traditional benefits like retirement rather than helping with caregiving, homebuying, and student loan expenses.

This is juxtaposed against the employees’ perspective in the survey. While retirement savings topped their list of priorities, a growing number said they want more near-term financial help in areas including emergency savings, assistance with mortgages, and paying for college (26%, up 13% from 2023).

“The appetite for these programs is growing, but there is still an education gap,” Scagnelli says. “I still go to conferences and talk to people who say they didn’t know they could do this [provide loans to employees through vendors like Canary]. And often budgeting is a holdup, especially in small companies.”

From Scagnelli’s perspective, financial wellness benefits are less expensive than high turnover.

“If you can be an anonymous resource for people to turn to to make sure they aren’t homeless and can come into work next week, there’s an obvious business case to be made here,” she says. “The cost of replacing an employee can be higher than the trade-off of putting a few thousand dollars into an employee emergency fund.”

Even small amounts of money can be the difference between low-wage earners showing up or missing work, says Ram Palaniappan, founder and CEO of Earnin, which provides no- and low-cost payroll advances known as earned-wage access.

“We often hear that people use our product to buy gas to get to work,” he says. “If you are a low-wage worker, you’re filling your tank $15 at a time. If something unexpected happens that you had to spend money on—and you’re out of gas—you’re not going to overdraft your account to buy gas to get to work.”

Employers can’t change the cost of childcare, gas, or housing. But they control wages, which Despard and others say should be the first step in improving employee financial well-being.

“It almost goes without saying that the top of the list is paying a living wage,” he says. “That is [an employee’s] wage, relative to the cost of living. And a lot of people out there, regardless of where they work, are struggling with affordability as their chief concern.”

In a 2025 study of about 8,000 employees, the Financial Health Network found that 52% of respondents reported earning a living wage—62% of surveyed workers at large companies with over 1,000 employees and 32% of workers at businesses with fewer than 100 employees.

“One of the challenges employers face is income is highly contextual,” says Matt Bahl, vice president of workplace solutions at the Financial Health Network, which focuses on improving consumer financial health. “They don’t know if an employee has another income or dependent in the house and no employer is going to individually tailor their wages to that.”

Bahl recommends employers use a two-income, two-dependent benchmark as a starting point for determining wages. Though the number of single households is rising, these people often cohabitate with friends or family, so most residences in the United States still typically have two incomes, he says.

Even using statewide data, living-wage numbers vary greatly. For instance, a living wage for a two-working-adult, two-child household in New York is $33.29 per hour, according to the Living Wage Calculator from the Massachusetts Institute of Technology. In Colorado, it’s $32.90 per hour; in Mississippi, $22.43; and in Indiana, $26.47.

“Income is so central to the way the U.S. benefit system works,” Bahl says. “We ask people to contribute their own dollars into their benefits, but if they can’t pay for food or housing, there is no way they are going to contribute to an HSA [health savings account].”

Affordable Health Insurance

Health insurance is the second component employers should emphasize to improve financial fitness, Bahl says. Robust plans can help keep employees, particularly those with chronic health conditions, from incurring healthcare debt or avoiding the healthcare system altogether and missing work due to untreated issues.

Many employers, however, offer high-deductible health plans (HDHPs), where employees must put in the first dollar spent. Bahl’s research has found that having these plans is, in essence, equivalent to being uninsured for most employees. Employers should make small contributions to an HSA—even $25 to $50 per pay period—he says. Doing that small thing greatly increases the chances that employees will seek out the healthcare services they need.

Kyle Bingham, director of workplace to wealth strategy at OneDigital Financial Services, says many low-income employees choose HDHPs because of their lower cost. But they may not realize how much out-of-pocket risk they take with these plans. Conversely, a healthy person who doesn’t have a high income may choose a more robust plan with high premiums that could go toward take-home pay.

“You can underinsure, but you can also over-insure,” Bingham says. “And I think that’s when a conversation can become a gateway, and you have to make sure when a person is making a financial decision all of these pieces come back together.”

Despard recommends that employers contribute the amount of the health plan deductible into an HSA for low-wage workers. So, if the plan has a $2,000 deductible, the employer puts that amount in for the year.

Despard is also a fan of offering wage-tiered premiums, which he says only about one-quarter of employers with low-wage workers use. With this kind of plan, employers cover more of the monthly premium for low-wage workers and less as workers rise on the wage scale.

Financial Preparedness

One decades-old financial wellness tool that needs to change for the better is financial literacy. Merely offering financial wellness classes without other resources is not always an effective tool.

This is partially because financial education should be personalized, Bingham says. Just offering a class on 401(k)s, for example, could be a disservice because people may think they already contribute enough or can’t afford to contribute, so it doesn’t pertain to them.

“We now know that there are so many financial struggles and challenges people are facing and there are all different circumstances that need to be taken into account,” he says. “We survey employees, and it brings to light what employees are facing. We may find that half of a company’s workforce is living paycheck to paycheck and a more effective tool may be a budgeting app or another debt solution that’s out there.”

In lieu of generic financial classes, Bahl says that financial coaching tends to be more effective. The best ones help people navigate their benefits.

Financial coaches can help workers understand when to take a hardship loan instead of using their emergency savings account or pulling from their 401(k). They can help them manage short-term needs while continuing to save for the future. Employees, he says, are often aware of their benefits, they just don’t know how best to use them.

The market is flooded with financial coaches, but employers may want to look to nonprofit vendors that have low fee structures geared toward low-income workers.

White-collar employers also focus on providing certified financial planners (CFPs), says Shannon Hanko, financial resilience innovation and growth leader for WTW North America. CFPs offer comprehensive financial services including investment advice, estate planning, retirement, and assistance with taxes.

Artificial intelligence is the newest realm for financial wellness products. Because AI can analyze data so quickly, budgeting programs can suggest personalized ways to meet a person’s savings goals based on their spending habits. AI programs are also adept at creating financial scenarios based on potential changes in the market, job conditions, and lifestyle. This can help people better understand how future uncertainties can impact their finances. Hanko says AI is best used when it can integrate with a person’s total benefits package to consider health and financial offerings.

In the Financial Health Network’s 2025 study, researchers cited other traditional benefits that employees typically offer, but don’t necessarily help with near-term financial issues many employees are facing. The researchers ranked various benefits on how the programs helped a person’s financial health score—a score they created to measure a household’s ability to save, borrow money, and plan for its future. Life insurance, for instance, provides replacement income for a family after a loss, but ranked as a neutral benefit for a person’s financial health. Disability insurance only increased a person’s financial wellness by two points because there must be a triggering event to have an impact.

Some newer benefits, like childcare subsidies, homebuying assistance, and tuition reimbursement, should be considered less important for employee financial well-being, Bahl says. These are not only costly, but they may be more difficult for the employees to use. For instance, employees can’t use childcare subsidies to support family members who help with their children. With tuition reimbursement, low-wage employees may not be able to front the costs to pay for school.

Bahl stresses that core benefits should be top of employers’ minds. These are living wages, retirement accounts where the employer has an unconditional match of at least 3%, putting money into HSAs for people with HDHPs, and paid leave. Health insurance had the largest impact on a household’s financial wellness, according to the Financial Health Network report.

“If they do nothing else, they could be focusing on those four areas,” Bahl says. “And for the employers who already offer healthcare and retirement, they need to make sure they are adequately designed so they benefit the employees.”

Fintech Addresses Challenges

As fintech has expanded, the financial wellness industry’s focus has shifted slightly from education to tools employees can use to improve their economic situation. The projected growth in the multibillion-dollar financial wellness benefits market is anticipated, in part, due to the increased use of technology that makes it easier to deliver personalized financial advice, Allied Market Research said in a 2023 report.

OneDigital uses these tools as part of a broader financial wellness strategy, Bingham says.

“Tech solutions alone won’t have the impact they could if there isn’t a way to help employees understand how to use the tool and take action,” he says. “We have to offer those resources and solutions, but employees also need a connection point where they can sit with a financial coach and see how to use that tool according to their specific needs.”

Among the fintech platforms highlighted by the Financial Health Network: Onward, a mobile savings and financial education app; MedPut, which negotiates healthcare discounts on out-of-pocket expenses an offers interest-free payment plans on healthcare bills; HoneyBee, which offers employees 0% annual percentage rate (APR), no-fee loans; and Brightside, which provides a suite of financial care products to employees.

The organization’s researchers found in 2021 that most users of the products were lower-income workers. Users were less likely than non-users to be able to pay a $400 emergency expense with cash, had less on-the-job tenure, were more likely to have dependents, put off taking medicine because of prescription costs, did not have a spouse, and were female or people of color.

Another resource in this sector is emergency grants, like Grant Circle offered through Canary and employee relief funds through the Emergency Assistance Foundation. Employers seed a charitable fund that can also be funded by employees, an organization’s board, and the community. Companies set parameters on grant limits, which are often between $500 and $3,000 depending on the size of the fund. Employees with a qualifying emergency (including a natural disaster, car issues, death in the family, and property theft) can apply for a grant with no fees. Employees often get the money directly deposited into their checking account within a week. Using fintechs for this purpose has several advantages. The process is anonymous to the employer, which could encourage people to ask for help. And employers don’t have to keep funds on hand to distribute to people in need of assistance.

“They can get approved, the money is direct deposited to them by PayPal,” Scagnelli says. “If someone is facing eviction and needs rent money, they can get through the process from start to finish in a matter of days.”

Canary is only about 5 years old. As it has grown, so has receptiveness to the program, Scagnelli says: employer clients increased by 72% between 2024 and 2025 while the number of grants provided grew by 308% in that time. Many employers start out providing $500 grants, then increase that to $750 in about six months. A significant number of Canary’s clients have many hourly and part-time workers. Retail, hospitals, manufacturing, and construction businesses that often pay minimum wage salaries are also regular clients.

Earned-wage access is also growing in popularity. The industry, which enables employees to obtain part of their paycheck prior to payday, began in the mid-2010s with companies like Payactiv and Chime. A 2025 market report projected the market value growing from about $6.2 billion in 2025 to more than $61 billion in 2032. The United States accounts for about 42% of the global market. Changing the way people are paid is merely about catching the payroll industry up with the rest of today’s technology, Earnin’s Palaniappan believes.

“If you think about the way paychecks work, it’s odd to think that most people get paid every two weeks,” he says. “If I typed a text and the program said it would send it in two weeks, I wouldn’t use that system again. The core reason for using earned-wage access is to let the employee get paid when they need it instead of the rigid cycle that was chosen by payroll processing companies.”

Earned-wage access platforms like Earnin allow people to cash out on payroll that has been earned but not yet paid. Employees can draw up to $150 a day and $750 per pay period from Earnin. There is no cost for the employer or the employee when the money is sent via an Automated Clearing House Network transfer. This transfer gets the money to the employee in one to two days. If the worker needs the cash immediately, a wire transfer is $2.99.

When using the product, the employer processes payroll as it normally would, and Earnin fronts requested money to employees; when the payroll runs, the company collects the provided amount from the employee’s bank account. The platform works with any payroll system, though Earnin also offers payroll services. In addition, Earnin offers a real-time pay option in which employees pay $2.99 a month to access their pay as soon as they have earned it, up to $1,500 per pay period.

This kind of program, Hanko says, works particularly well for hourly workers. The University of Oregon researched 1.5 million customers of Earnin’s Cash Out product to understand the impact on users. University researchers found that incomes rose by an average of $334 a month. Using the app improved attendance as well as the number of overtime shifts employees took.

“People knew that if they took an extra shift that day, they would get that money right away to pay their bills,” Palaniappan says.

Most Earnin clients make less than $100,000 per year, but Palaniappan says some higher earners use the products as well. One client was a government worker who had a side hustle as a custom candlemaker. Instead of waiting for payday to buy supplies, he was able to increase his orders each month by drawing on earned pay early.

Hanko says WTW sees higher earned-wage access use among retailers and industries where employers encourage overtime shifts. In other industries, like healthcare, it’s used to a lesser extent within a comprehensive financial wellness offering.

“There is usually an attraction and retention objective there,” Hanko says. “If they [employees] are using it to solve for emergency expenses, it’s offered around a broader support program that might include coaching and emergency savings, so the next time they, hopefully, don’t have to take out as much from their paycheck because they are building better financial behaviors.”

Earnin and Canary charge nominal fees for their services, but not all vendors in this space offer low interest rates. Even with low fees, the APRs are very high. According to a 2024 Consumer Financial Protection Bureau study of eight large firms offering earned-wage access, the average early draw on wages was about $106 and the average worker pulled about $3,000 annually. The average worker used the platform 27 times a year, with almost half using it monthly. The fees ranged from $0.61 to $4.70, and the average worker paid almost $70 annually in fees. These may seem relatively low, but when the Bureau calculated the APR for an average transaction amount with those fees, the typical APR was 109%.

It’s imperative that human resource staff vet any financial wellness products they are considering for an employer. Despard says employers also have some leverage over fees. If the fees aren’t set or seem unusually high for the type of product, companies can request flat rates or low fees and make sure they remain fixed.

Due Diligence

According to the Financial Health Network’s 2025 report, many midsize to large employers offer more than 50 total benefits to their workforce and more than 30% of employers’ workforce spending goes toward benefits. With so much money flowing into one area, it behooves employers to know if these benefits are actually sustaining employee financial health.

“We see employers say, ‘We offer this benefit, but only 10% of employees use it,’” Bahl says. “We often ask them, ‘Then how many people actually need that benefit?’ Employers need to understand their workforce’s challenges, what solutions solve for those and which don’t, and if there is an alignment between need and what’s being offered.”

He suggests employers answer a few questions to figure this out. First, if the employer can spend just a few dollars per person on benefits each month, where will those dollars have the most impact? Second, how well do current benefit offerings ensure employee financial health? Third, how can employers better understand which populations are most likely to use benefits under consideration?

Despard recommends that employers ask their employees directly how and why they would use financial wellness benefits. For instance, some may use early wage access programs, but only if they are free for the employee.

“Under what basis could an employer possibly know if it is a good benefit that will help their people without asking their employees?” he says. “It’s also really important to do due diligence because a lot of vendors are making big promises about their products that don’t hold up to research.”

Human resources staff should be skeptical of businesses that claim to offer products that will greatly improve employees’ financial wealth, according to Despard.

Bingham says employers should focus on the results the app or tool provides and make sure it aligns well with employees’ needs and that it works for their specific demographics. An employer should also be able to quantify the impact of the solution because “if you can’t measure it, you can’t manage it,” he says.

Bahl says that almost every time he consults with employers about financial wellness offerings, he challenges their idea about how well they are doing with their workforce. One Financial Health Network client dropped a product that cost a “significant amount of money but showed no impact,” he says. Instead, the employer began contributing to an HSA account. This generated high use of the healthcare plan and positive feedback from the workforce.

Bahl cites a Massachusetts Institute of Technology case study of PayPal from 2019. In 2015, then-CEO Dan Schulman said PayPal’s goal was to “democratize financial services,” according to the MIT report. He started by looking inward and found that many company employees faced financial insecurity. An internal survey found that about 65% of entry-level and hourly workers reported running out of money between pay periods.

“Even an employer like this in the finance industry that thinks they are doing the right things can find significant gaps in workforce financial health and make tremendous changes,” Bahl says.

PayPal then established a four-pronged plan to increase employee financial wealth. It raised wages where company leaders thought appropriate. It reduced employee healthcare premiums by 60%, which amounted to an average of $158 savings per paycheck for an employee with a spouse and children. PayPal created a company-funded HSA and contributed $900 for any employee with dependents and gave stock equity to thousands of employees who hadn’t previously been eligible to buy stock. Finally, it began offering complimentary financial wellness coaching.

It’s important to understand workers’ overall financial life and how these wellness products can work in a bundle to ensure they have the most impact, Bahl says.

“We see this as foundational,” Scagnelli says. “Things like financial literacy and building savings are great, but if people don’t have money to pay their bills or struggling with eviction, they are not thinking about how financial literacy is going to help them out. It’s nonnegotiable to figure out ways for employers to get money into the hands of their people.”