WASHINGTON, D.C. – The Financial Technology Association (FTA) submitted a statement for the record for the House Financial Services Digital Assets, Financial Technology, and Artificial Intelligence Subcommittee hearing, “Delivering for American Consumers: A Review of FinTech Innovations and Regulations.” Below are excerpts highlighting how fintech products such as Earned Wage Access and Buy Now Pay Later improve affordability for everyday Americans.
On Fintech Enhancing Affordability
At a time when every dollar counts, financial technology is delivering real solutions that help Americans manage their money more effectively and avoid costly traditional alternatives. According to The Harris Poll, eight in ten Americans use fintech to manage their money, and 93% report benefiting from it. These aren’t just statistics. They represent millions of families who are finding better rates, lower fees, and tools that actually fit their lives. They are workers who can access their paychecks immediately instead of waiting days. They are consumers who can pay for products without incurring high interest fees. These digital tools are putting people back in control of their finances, helping them keep more of their money while saving time.
The opportunity is clear: we can build on this momentum to create a financial system that truly serves all Americans, or we can allow outdated barriers to hold people back. The choice we make will determine whether financial services become more accessible and affordable or whether millions of Americans remain stuck with options that don’t serve them well.
On Earned Wage Access: Empowering Workers
Millions of Americans live paycheck to paycheck, and Earned Wage Access (EWA) provides a critical tool for managing affordability challenges between pay periods. EWA is different from a loan, and it allows workers to access their already-earned wages on demand, rather than waiting for scheduled paydays that may be as infrequent as monthly. EWA addresses a fundamental timing mismatch between when bills are due and when workers are paid. When workers face unexpected expenses such as utilities, rent, or car repairs, they currently must choose between expensive alternatives like payday loans, credit card cash advances, or overdraft fees. EWA gives workers access to their own earned wages, helping them weather short-term financial shocks without incurring high costs.
On Addressing Affordability Through Buy Now Pay Later
Buy Now Pay Later (BNPL) offers consumers a transparent alternative to high-cost credit during a period when affordability remains a top concern for American families. The interest-free Pay-in-Four model provides small, short-term payment options – typically four installments over six weeks – with no fees when consumers repay on time. The affordability advantage is clear. Unlike credit cards, which generate revenue primarily from consumers paying interest and fees, BNPL Pay-in-Four companies derive the vast majority of their revenue from merchant partnerships. This alignment of incentives encourages on-time, in-full repayment rather than prolonged debt accumulation.
On Why BNPL Pay-in-Four Products Should Not Be Regulated Like Credit Cards
One issue to address is the growing push to regulate BNPL pay-in-four like credit cards. This approach fundamentally misunderstands what BNPL actually is. Credit cards are revolving credit products designed for ongoing borrowing. Cardholders can carry balances month after month, pay interest, and borrow up to their credit limits repeatedly. BNPL is something different entirely. These are short-term installment plans, typically lasting four to six weeks, with fixed payment schedules and never any interest charged…
BNPL products already have strong consumer protections that work differently from credit cards but are equally effective. If you miss a payment on a BNPL purchase, most providers immediately pause your ability to make new purchases until you catch up. BNPL providers also offer real-time tracking, payment reminders, and in-app tools that give consumers clear visibility into what they owe and when, while also helping them manage payments, returns, and delivery status.
Read FTA’s full statement for the record here. To learn more, read “Just the Facts: Buy Now Pay Later” and “Just the Facts: Earned Wage Access.”
ABOUT US
The Financial Technology Association (FTA) is a network of fintech leaders shaping the future of finance. We champion the power of technology-driven financial services to catalyze innovation and advocate for modernized policies and regulations that reflect the digital transformation.