The California Department of Financial Protection and Innovation (“DFPI”) adopted its final rule to regulate an earned wage access provider that delivers its services to consumers in California (the “California EWA Rule” or “Rule”).  The new California EWA Rule is a milestone for promoting a better ecosystem for EWA—and Rain believes that the Rule can provide a fair framework that other state agencies can build on to promote the right kinds of consumer protections for EWA services.

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At Rain, we consistently have supported regulatory measures—by federal and state agencies—that seek to protect consumers while promoting innovation in how EWA services can be delivered.  Rain applauds the multi-stage process used by the DFPI to develop the California EWA Rule.  The DFPI has demonstrated that when comments and concerns, from consumers, their advocates, and EWA providers themselves, are taken into consideration, responsible regulation for this still-emerging financial service can be achieved. 

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‍Big Takeaways for the California EWA Rule 

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State officials who lead state financial services agencies continue to evaluate EWA products as distinct from standard extensions of credit to consumers.  Several states have enacted new laws that regulate EWA services, and the trend is towards the creation of a new regulatory structure for EWA.  The California EWA Rule best demonstrates this state-level trend toward responsible oversight of an EWA provider.   

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Here are the key takeaways for the California EWA Rule:

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1. Employers Are Not Covered.  A typical employer that goes about its business and engages an “employer-integrated” EWA provider is not covered by the California EWA Rule. 

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Thus, only Rain—not your business—needs to concern itself with the new requirements adopted by the California DFPI.  

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2. EWA Provider Must Register With the DFPI.  The EWA provider must register with, and be supervised by, the DFPI.  In order to continue to deliver its EWA services in accordance with the California EWA Rule, an EWA provider must be prepared to submit its application to the DFPI by mid-February.  

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Rain already is at work in preparing its application to the DFPI, and has systems designed to meet the agency’s expectations when conducting its oversight.   

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3. Effect of Registration.  Once registered with the DFPI, an EWA provider must maintain its operations so that the provider can (i) timely file the required reports describing the nature and scope of the provider’s EWA services and (ii) satisfy the DFPI’s expectations for compliance when the DFPI conducts its examinations.  The DFPI has announced that examinations of EWA providers could begin as early as the late 2025.   

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4. Consumers Are Protected By Registration.  The main benefit of the registration system under the California EWA Rule is for consumers to have confidence that the EWA provider that is marketing its services is a bona fide business—not a scam.  A registered EWA provider is supervised by, among other measures, oversight of the provider’s owners and top-level management via background checks, and the provider’s operations are subject to periodic examinations to assess compliance with applicable law. 

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Looking Forward

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What are some of the implications of the California EWA Rule?  Rain believes that the framework adopted by the DFPI is the best path for EWA providers, such as Rain, that deliver “employer-integrated” EWA services.  Consumers should be supported by responsible regulations for EWA to help them understand how an EWA product is safe to use.  

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In particular, for an employer-integrated model, such as Rain’s EWA services, the consumer should have confidence that the registered EWA provider needs to comply with basic guardrails designed to prevent the kinds of “debt traps” that payday lenders and other unscrupulous creditors set for consumers.  For example, under the California EWA Rule, a registered provider must conform to the following key requirements:

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(i) The provider may not have any legal or other contractual claim or remedy against the consumer based on the consumer’s failure to repay in full the amount of the earned wage advance; and 

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(ii) If the amount due is not timely repaid (i.e., by the consumer’s employer via an adjustment to the consumer’s paycheck), the provider may not engage in any debt collection activities, place the amount due as a debt with or sell it to a third party, or report the amount due to a consumer reporting agency.

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All earned wage payments made by Rain to a consumer are non-recourse. Rain does not report information to any type of debt collection agency or to a consumer reporting agency if Rain does not receive payments from the employer because the employer cannot make the adjustment(s) to the consumer’s paycheck.

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Rain encourages other state legislative bodies, as well as state financial regulatory agencies, to work expeditiously to enact EWA laws that track the DFPI’s rule.  Rain supports responsible regulations for EWA services—i.e., those that provide consumer protections and promote innovation in EWA services—so that consumers and their employers can have higher levels of trust in the EWA providers that they are doing business with.

At-a-Glance

• On July 18, 2024, the Consumer Financial Protection Bureau (CFPB) released for public comment a new Interpretive Rule under the Truth in Lending Act (TILA) to promote price transparency for EWA (Earned Wage Access) products.
• Rain believes that, overall, the CFPB’s proposed Interpretive Rule is a healthy development for the ecosystem of EWA products. 
• Nothing in the CFPB’s proposed Interpretive Rule affects an employer. TILA does not apply to the day-to-day business operations of an employer that uses an employer-integrated EWA solution, such as Rain’s EWA services.   
• Compliance responsibilities under TILA for Rain’s employer-integrated EWA services will fall entirely to Rain.   

The Proposed Rule and CFPB’s Goals

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The Consumer Financial Protection Bureau (CFPB) has issued a request for comment on its proposed Interpretive Rule (Proposed Rule) relating to earned wage access (EWA) products under Regulation Z, which is the agency’s rule that implements the Truth in Lending Act (TILA).  Specifically, the CFPB is proposing: first, to revoke the interpretive rule that the agency published on December 10, 2020 (2020 Rule); and, second, to “replace” the 2020 Rule with a new Interpretive Rule, after considering the comments submitted on the Proposed Rule.

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Overall, the CFPB intends for the Proposed Rule to promote price transparency for consumers.  As the CFPB’s Director Chopra explained in his Prepared Remarks announcing the proposal, the Proposed Rule intends to require EWA providers to provide cost disclosures to achieve two goals: (1) to help consumers “compare options” among different financing products; and (2) promote an EWA ecosystem in which providers “compete on clarity, not confusion.” Rain wholeheartedly supports the CFPB’s objectives of better serving consumers by helping them compare different EWA products—and easily understand the benefits of Rain’s employer-integrated EWA services.  

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CFPB’s Proposal Applies Broadly–But Based on a Narrow Set of Requirements

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Breadth: In terms of its reach across the EWA market, the Proposed Rule is broad. The CFPB intends for its eventual final rule under TILA to apply across the board, regulating a wide range of EWA providers. Under the CFPB’s proposal, both employer-integrated providers and D2C (Direct-to-Consumer) providers would be subject to applicable cost-disclosure requirements.  

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Focus: The Proposed Rule also is narrow because the CFPB’s proposed shift in policy for EWA providers is limited to cost-disclosure requirements under Regulation Z. The Proposed Rule states, at the outset: “[The Proposed Rule] only addresses the application of certain Regulation Z and TILA provisions; it does not address the application of any other laws that concern ‘credit.’” As the CFPB’s Director Chopra explained: the Proposed Rule is designed so that EWA providers must provide cost disclosures that account for “incidental costs, even if the amount is variable,” in accordance with existing requirements—namely, the applicable requirements (i.e., those that apply to a provider’s particular EWA product) under Regulation Z and TILA.  

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The CFPB is not proposing a full scheme of rules intended for the agency’s oversight of EWA providers. Nonetheless, our regulatory team will monitor the agency’s rulemaking progress so that Rain can assess whether any other requirements could spill over from the CFPB’s eventual final rule under Regulation Z and TILA.

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No Impact on Employers

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The CFPB’s Proposed Rule does not affect employers using Rain’s EWA services.  

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TILA does not apply to an employer that uses an employer-integrated EWA solution, such as Rain’s services. As explained above, the Proposed Rule only aims to change the agency’s policy under TILA. Thus, the CFPB’s action does not impose obligations on an employer; all of the regulatory obligations for compliance with Regulation Z and TILA will fall to Rain.  

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Price Transparency for Users 

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Price transparency for Rain’s users has always been a core value for our company. Clear and straightforward pricing, in both our marketing towards users and in the Rain app, has been a constant feature in Rain’s offering and provision of earned wage payments.   

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Cost Disclosure Upfront: When a user opens a Rain account, the user will find an easy-to-read table of key terms and conditions on the first page of the standard contract. The table focuses on the costs and terms so that users can understand how Rain’s EWA product serves them. Specifically, the table clearly describes the amount of the fee, which varies by the type of transaction that the user chooses, and explicitly states the absence of any “tips” or hidden charges. 

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Cost Disclosure In the Rain App: For a typical user of the Rain app, the user first checks the amount of earnings that Rain is making accessible to them, based on data that Rain collects through its integration with the user's employer. If the user is requesting an earned wage payment, for some or all of that amount of earnings, the user is presented with a choice as to how to conduct that transaction. For each earned wage payment, the price of the transaction fee—including the fee of $0.00 when the user selects an ACH transfer—is clearly and prominently displayed prior to the time the user approves of the transaction.

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Our commitment to price transparency for users is aligned with the Proposed Rule, and demonstrates our leadership in the EWA industry to “compete on clarity, not confusion,” as Director Chopra stated.

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Safe and Predictable Financial Solutions

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Rain’s EWA product remains a safe and predictable alternative to predatory lending. Rain is committed to providing a low-cost service that helps employees access their earned wages without falling into debt traps. Each earned wage payment is requested by the user on an as-needed basis, as the user chooses, and Rain’s earned wage payment is not subject to any late fee or add-on fee that might surprise the user.

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More generally, Rain does not resort to a method of providing financial products or services to Rain’s users—who are the employees of Rain’s trusted employer-partners—by placing them in the awkward position of “tipping” the financial services provider. Who tips the teller at the bank when withdrawing funds from a checking account? The teller’s window does not have a tip jar. The same expectations should apply to EWA services. In this regard, Rain believes that the CFPB’s primary objective in issuing the Proposed Rule is to protect consumers from bad actors who mislabel credit products as EWA products. The direct-to-consumer providers typically engage in these types of practices, including by depending on “tips” for revenue. For this reason, Director Chopra went out of his way to declare that the agency “is paying close attention to illegal tricks on tips.”

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Staying Ahead with Strategic Compliance Management

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Rain is prepared to meet the emerging requirements of Regulation Z, as will be further clarified in the CFPB’s eventual, final interpretive rule. Our regulatory team monitors the development of regulations that affect EWA products and services so that Rain’s services can satisfy those requirements and serve the needs of Rain’s users.

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‍Conclusion

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Overall, the Proposed Rule is a positive step in the development of requirements under Regulation Z TILA for the ecosystem of EWA products. Rain supports the Bureau’s goals for disclosure standards under TILA so that consumers can compare different EWA products—and easily understand the benefits of Rain’s employer-integrated EWA services. Moreover, the Proposed Rule does not create any new risks to Rain’s employer-partners.

As a relatively new benefit in a rapidly evolving industry, it’s important for employers evaluating potential EWA solutions to consider, at least in part, the regulatory compliance measures that the providers apply to their own businesses.

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At the end of the day, you should have confidence in the EWA provider you choose to entrust with your employees’ financial wellness.

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Let’s take a look at steps you can use to evaluate providers, and how Rain stacks up with regulatory requirements that affect EWA services.

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Background: Different Types of EWA Services Face Certain Regulatory Challenges

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First, understanding key aspects of the types of services used by various providers helps in evaluating how a particular provider could be covered by, and can comply with, rules that regulate EWA. The types of EWA services can be summarized as follows:

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(1) Payroll Adjustment Model

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A payroll adjustment model is built on two separate, but connected, transactions. First, on the employee’s request, the EWA provider initiates the earned wage payment to the employee’s own checking account, as specified by the employee. Typically, the provider makes its payment in exchange for the employee’s assignment of the rights to the earned wages.

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Second, the provider presents to the employer the amount of the earned wage payment, and requests that the employer make the payment to the provider–because the provider holds the rights to those funds (due to the first transaction with the employee).

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Next, on the pay statement, because the employer has paid the EWA provider for the amount of wages involved in the earned wage payment, the employer adjusts the amount of the employee’s net pay to reflect that payment.

In this Payroll Adjustment Model, any transferred wages and fees usually are reflected in the employee’s pay statement as an after-tax voluntary deduction from earnings. Rain uses the Payroll Adjustment Model.

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(2) Payroll “Intercept” Model

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In a payroll intercept model, an employer gives the provider control over disbursing payroll to employees on their behalf.

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Similar to the Payroll Adjustment Model, on the employee’s request, the EWA provider initiates the earned wage payment to the employee’s own checking account (or potentially to the provider-controlled account or payment card).

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In this model, however, the provider will establish shadow FBO (For Benefit Of) accounts for all participating employees to route and intercept their paychecks on payday. The provider recoups their funds plus a fee, and sends the remaining balance to employees’ usual bank accounts.

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Participating employees are paid their wages by the EWA provider, and the employees’ pay statements will match the provider’s controlled account, not the employee’s usual bank accounts.

Key Factors to Consider for Each Model

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CFPB Advisory Opinion: Characteristics of a Compliant EWA Program

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An EWA provider is subject to regulatory requirements that, among other areas, apply to initiating payments to an employee’s bank account and protecting the employee’s financial information. However, there is no specific federal regulation that defines an “earned wage access” or “on-demand pay” product.

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Depending on the terms and conditions of a provider’s EWA product, the EWA payment possibly could constitute an extension of credit to the employee that would be regulated under the federal Truth in Lending Act (“TILA”) and the Consumer Financial Protection Bureau’s Regulation Z, which implements the requirements of the TILA.

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In 2020, the CFPB issued an “Advisory Opinion” that provides the standards for an EWA provider to not be considered a “creditor,” and for the provider’s payment to not be a “credit” product that is regulated by Regulation Z. If the EWA provider meets all of the requirements for a “Covered EWA Program”—i.e., a program that is exempt from the requirements of Regulation Z—then the EWA provider is not required by Regulation Z to deliver certain types of disclosures when the employee-customer uses the EWA product.

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The Advisory Opinion provided several characteristics of a Covered EWA Program that a provider needs to meet so that the EWA provider’s payment to the employee is not a credit product under Regulation Z. Generally speaking, the CFPB’s Advisory Opinion is based on two core standards:

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(1) The EWA provider must have a contract in place with the employer to provide the EWA product to the employer’s employees; and

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(2) The EWA provider recovers the amounts of the EWA payments due to the provider through “employer-facilitated” transactions.

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If a provider operates under “any authorization to transfer funds from [an employee’s] account” for repaying the provider, then the provider does not satisfy that second standard–which means that the payment to the employee is treated as a credit product, instead of a true earned wage payment.

EWA Compliance: 

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In addition, the CFPB’s Advisory Opinion states:

• The amount of a provider’s EWA payment needs to be computed based on the “‘accrued cash value of wages’” that the employee has earned up to the date and time of the transaction, and the computation must be based on information provided by the employer;
• The provider must provide a free option to the employee to obtain an EWA payment (i.e., the payment may not always be dependent on the payment of a fee) and the provider may not solicit “tips” from the employee;
• If the “employer-facilitated” transaction for payment to the provider is not made, including if the employer becomes bankrupt, the provider has no contractual claim or remedy to recover the payment from the employee;
• The provider may, depending on the circumstances, impose a nominal processing fee, but the Bureau reserves the authority to review the provider’s fee structure to assess compliance with the requirement to offer the EWA payments at no cost;
• The provider must disclose to the employee (such as through the contract) that the provider will not engage in any debt collection, as well as disclosures relating to the requirements summarized above; and
• The provider may not provide its EWA payment to an employee based on the provider’s assessment of the employee’s credit risk (e.g., the provider may not use a credit score).

Bona fide earned wage access products need to operate in a manner that provide employees with access to their own funds, i.e., funds that the employer already is obligated to pay to the employee. Plus, the employee is not obligated to make the repayment to the provider. Any provider that asserts control or management over the employee’s earnings for repayments, including by controlling the flows of funds on behalf of the employee, should be reviewed closely because that approach is not consistent with the standards contained in the Advisory Opinion.

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New State Laws: Missouri, Nevada, Wisconsin, Kansas, and South Carolina

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EWA products and services are emerging as valuable financial products— both to employers and their employees—and Missouri and Nevada have enacted consumer protection laws that expressly regulate EWA providers. This pioneering approach provides a structure so that consumers’ rights are more fully protected, particularly to guard against lenders that are masquerading their loan products as “earned wage access” services.

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As of May 2024, Wisconsin, Kansas and South Carolina are the most recent states that have enacted Earned Wage Access regulations. The Wisconsin (2023 Wisc. AB 574), Kansas (KS HB 2560), and South Carolina (SC S.700) statutes establish a regulatory framework, registration and licensing requirements, and consumer protection measures for companies providing Earned Wage Access services to the states’ residents.

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Classifications of EWA Providers

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Missouri’s law (2023 Mo. SB 103), Nevada’s law (2023 Nev. SB 290), and Wisconsin’s law (2023 Wisc. AB 574) have in common a general requirement: other than certain regulated financial institutions, such as a bank or credit union, any person or entity providing EWA services to residents must be authorized to do so by the state’s financial regulatory agency.

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These laws introduce two types of EWA providers that will be supervised by the states’ agencies. One is the “direct-to-consumer” provider, and the other is the “employer-integrated” provider. An entity may seek authorization to operate in both capacities. Regardless of how a provider fits within each state’s framework, only that provider–not the employer–will be subject to oversight.

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A “direct-to-consumer” EWA provider delivers EWA services primarily based on earnings data obtained from the consumer. By contrast, an “employer-integrated” EWA provider provides access to the consumer’s “earned but unpaid income” based on employment data obtained, directly or indirectly, from the consumer’s employer. Rain’s EWA services qualify under the “employer-integrated” category.

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Core Requirements of New EWA Laws

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The newly enacted EWA laws contain several key requirements designed to protect consumers. Among other requirements that apply to a provider are these three main measures:

1. Complaints Management: The provider must have policies and procedures to address questions or complaints from consumers.
2. Clear Disclosure of Fees: All fees associated with the provider’s EWA servicesmust be disclosed to the consumer.
3. Privacy and Data Security: The provider must comply with all local, state, and federal privacy and information security laws.

In addition, these laws prohibit an EWA provider from using a consumer report to determine an employee-consumer’s eligibility for EWA services.

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Many, but not all, states have enacted laws that regulate an employer’s use of direct deposit. Most state laws generally require an employer to pay via direct deposit “by deposit of funds in an account in a bank or other financial institution designated by the employee” (Illinois).

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The language of these laws—that the financial institution is selected by the employee—suggests that the owner or holder of the account also would be the employee, but notice the silence on that nuance in the Illinois law quoted above. In California, the state’s agency regulating wage payments has explained that the purpose of that state’s law, which is similar to the Illinois law, is to provide an employee with a “ready and immediate means for an employee to withdraw their full wages as cash on the established pay day.”

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Other models use of an FBO Routing and Account Number puts the employer at risk of violating these state laws regulating direct deposit because the intercept activities both (i) disable the employee’s opportunity to “withdraw” any wages paid and (ii) lead to delays in settlement at the employee’s real bank account such that the employer is not making its payment on the established pay day.

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Legality of Payroll Deductions

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“Illegal payroll deductions” (other terms used are “wage discounting,” “wage assignment,” or “wage deduction”) is a terminology some vendors will often use to divert employers towards their solution.

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Rain’s model is an employer-facilitated payroll adjustment model in which an employer performs a paycheck adjustment at the end of a pay period. The payment of earned wages made by the employer to an employee, minus any earned wage payment(s) that Rain provided during that pay period, would not constitute a “withholding”, “deduction”, or “diversion” within the meaning of those laws because:

• No earned wages would have been withheld or diverted from the employee to pay for goods or services
• The employee is in receipt of the full amount of their net amount of wages (e.g. net of insurance premium) on payday.

Rain’s Structure Under Wage Deduction Laws

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Many states have enacted wage-deduction statutes designed to bar an employer from making a “deduction” from an employee’s wages—i.e., a diversion of or withholding from wages for the purpose of paying a third party for its goods or services.

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Rain’s structure for earned wage payments to an employee does not lead to a “deduction” that is covered under wage-deduction laws. When using the Rain App, an employee obtains an earned wage payment from Rain, and that payment is based on the employee’s actual earnings.

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Next, the employer computes the amount to be paid to the employee, and makes an adjustment to the pay owed to the employee in a manner that recognizes the earlier payment by Rain. The employer does not divert wages in a way that is covered by state wage-deduction laws; instead, the employer’s adjustment enables the employer to match its wage payment with the amount of Rain’s earned wage payment so that the employee is paid in full.

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Put another way: if the employer does not make the adjustment to its payment, the employee would be paid twice for the same earnings: first by Rain’s earned wage payment and then by the employer’s payment.

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Many states have statutes governing “deductions” an employer may make from employees’ wages, but not each state’s wage-deduction statute defines the term “deduction.” Instead, state wage-deduction laws typically take the following form:

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Except as otherwise provided, no employer may withhold, deduct or divert any portion of an employee’s wages unless:

1. The employer is required or empowered to do so by state or federal law;
2. The deductions are for medical care, without financial benefit to the employer;
3. The employer has a signed authorization by the employee for deductions for a lawful purpose accruing to the benefit of the employee; or
4. The deductions are for contributions to a retirement plan provided by the employer under section 401(k), 403(b), 408, 408A or 457 of the Internal Revenue Code.

This wage-deduction statute does not define “deduct.” The structure of a typical wage-deduction law shows that the purpose is to prohibit an employer from diminishing the amount of the wages under an arrangement that “diverts” funds to a third party for its goods or services.

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For example, an employer may not “deduct” or “divert” an employee’s wages to pay an auto body shop for repairing the employee’s vehicle. By contrast, an employer’s adjustment to a paycheck that accounts for the earned wage payment by Rain does not diminish the total amount paid to an employee because when the amount of the employer’s payment is combined with Rain’s payment, the employee receives wages corresponding to the earnings during the pay period. In addition, under Rain’s structure, the adjustment made by an employer does result in an action that “withholds” or “diverts” wages for the employer’s own use.

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Some states, such as Illinois, Minnesota, and New York, have wage-payment laws that require an employee’s written authorization for deductions. In Minnesota, for example, an employee generally must authorize a deduction from wages after any claimed indebtedness occurred. If the employer’s payment of wages on payday minus any earned wage access payments for that period were to be considered a wage deduction, the employee would need to authorize that deduction after each time the employee received an EWA payment.

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However, for the reasons stated above, the payment by the employer to an employee of earned wages, minus any earned wage payment that Rain provided during that pay period, would not constitute a “deduction” regulated under these state laws because no earned wages would have been withheld or diverted from the employee for third-party goods or services. The full amount of wages due for the pay period would have been paid to the employee.

EWA Compliance: Finding the Right Provider 10

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Money Transmission License Requirements

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Most states have enacted laws that regulate a person that acts as a “money transmitter.” With some exceptions, most of these state money transmitter laws require any provider that inserts itself into the payroll process by moving money from the employer’s payroll account to the employee’s normal bank account is a money transmitter–and must be operating with license in the jurisdiction(s) in which both the employer and employee are located.

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When an EWA provider is receiving the employer’s wage payments, via direct deposit, and passing those funds onwards to the employees, operating as a licensed money transmitter is important for providing assurances about the financial stability of that provider. Working with a provider that uses any kind of virtual direct deposit account without a money transmitter license puts the employer at risk because there is not a reliable financial backstop in case the provider experiences an operational or liquidity event that interferes with its processing of payments.

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Rain only provides its earned wage payments to employees in one direction: from a Rain-controlled account to the employees’ own normal bank accounts. Rain does not receive funds from its employer-partners to make the employers’ direct deposit payments for them. Thus, Rain does not operate as a money transmitter.

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How Rain Stays Current With Legislation

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Strategic Compliance Management‍

In the evolving landscape of Earned Wage Access (EWA), maintaining compliance is paramount for employers. Rain’s approach combines deep regulatory knowledge with proactive measures so that its EWA program adheres to current laws and industry standards. Here’s how Rain delivers strategic compliance management to partner with employers effectively.

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Informed Expertise

Rain’s expertise is defined by practical experience with regulatory bodies such as the CFPB and various state labor departments. Rain leverages strong ties with industry leaders and associations like Mastercard, Visa, APA, and IPA to stay well-informed and effectively advocate for best practices in EWA compliance.

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Rigorous Monitoring

We proactively track both federal and state regulations impacting EWA programs. Our regulatory team takes steps so that leadership is promptly updated on relevant changes through a systematic regulatory tracker. Any necessary program adjustments are swiftly actioned upon, with oversight from senior leadership and careful implementation by our business stake holders and legal experts.Rain already is prepared to meet the requirements that will arise under the newly EWA enacted laws. Rain aims to work with the state agencies during the approval processes so that Rain remains in good standing to deliver its EWA program to consumers in these states.Rain has also gone the extra mile to protect consumer interests. Our company has established disclosures for employee-consumers, particularly for the amount of the fee, if any, that may be imposed for a transaction, and maintains internal procedures that offer substantial protections to consumers.Plus, Rain’s privacy policy and information security controls are designed to satisfy standards that apply to a wide range of financial institutions providing banking and payments services. Importantly, under Rain’s Employer Payroll Model, the company does not seek payment from the consumer except in cases of wrongful conduct or unauthorized transactions when using the Rain App.

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Direct Communication

Dedicated account managers provide direct support and regular business review meetings that include the latest regulatory changes.

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Concluding Thoughts

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Finding a compliant Earned Wage Access provider shouldn’t be confusing. Vendors should be transparent with employers, without attempting to misinform or divert you. This isn’t always the case, but with the information in this article, you are armed to evaluate providers for compliance. Watch how potential providers discuss their program and their compliance and search for a partner you can trust.

Tom Scanlon, J.D., General Counsel and Chief Compliance Officer

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Tom advises the company on its contracts with employee-customers and its employer-partners, as well as the company’s arrangements with service providers, for Rain’s earned wage access services. Tom also is responsible for counseling Rain on compliance with federal and state laws regulating consumer financial products and services.

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Prior to joining Rain, Tom was a partner with Dorsey & Whitney LLP, and advised banks, fintech companies, and other clients on banking activities, payments systems, and matters involving consumer financial products and services. At the start of his career in Washington, D.C., Tom served at the Federal Reserve Board, and worked on rules for payments activities, financial privacy, data security, and consumer reporting activities. From 2009 to 2015, Tom served at the Department of the Treasury, and worked as the principal attorney of the Department’s team to help draft the Consumer Financial Protection Act of 2010 (Title X of the Dodd-Frank Act). Tom has experience with a range of financial services laws, including anti-money laundering laws, the Electronic Fund Transfer Act, and the Military Lending Act. Tom received his J.D. from the University of California, Berkeley School of Law, and his M.A.and B.A. from the University of California, San Diego.