When the car breaks down or the rent deadline moves up, waiting weeks for the payroll cycle is not an option for many New Yorkers. Historically, workers had no other choice but turning to predatory payday lenders, products designed to trap people in debt cycles with short-term, high-interest loans.

Luckily, a modern alternative has emerged in earned-wage access. EWA apps let workers access a portion of wages they’ve already earned before payday to cover everyday expenses. Unlike loans or credit, EWA is non-recourse, requires no credit check or underwriting, and does not charge interest, late fees, or penalties. Instead, EWA providers typically rely on optional tips or small fees for faster transfers. Because advances are limited to earned income, EWA makes it far less likely for users to fall into cycles of debt.

In short, EWA is a safer, more transparent option for managing short-term cash flow strain.

It’s also popular. Millions of Americans, and a growing number of New Yorkers, now use EWA and surveys consistently show high satisfaction. Most users say they understand the product, believe it’s the best option they had, and report improvements in their financial stability. At the same time, reliance on payday loans has declined.

Consumers clearly want and deserve services that meet them where they are. That’s why lawmakers should focus on protecting regulated access to safe tools. Sen. Jeremy Cooney’s bill takes that approach, establishing clear guardrails for EWA providers. It ensures transparency around fees, protects users from overdraft risks, and sets reasonable standards without misclassifying EWA as credit.

The proposal delivers strong consumer protections while avoiding overregulation, which could push these services out of reach and send workers right back towards riskier products. Unfortunately, not everyone is approaching this debate with consumers in mind.

Some critics are pushing for sweeping rules that would effectively ban EWA. The Center for Responsible Lending has emerged as a particularly vocal opponent. But this isn’t just a debate over policy, or even principle. While CRL claims to be a champion for consumer rights, in reality it was created and is funded by an incumbent credit union, Self-Help Credit Union. Now, CRL is conveniently attacking policies that threaten incumbents.

Credit unions like Self-Help have long struggled to meet the needs of workers living paycheck to paycheck. Now that fintech companies are stepping in with faster, cheaper, and more flexible solutions, some of these same incumbents are pushing to shut them down. Painting that effort as consumer protection doesn’t change the underlying dynamic: It’s an attempt to block competitors, and consumers are left paying the price.

New Yorkers deserve better, and Cooney’s approach gets the balance right. Instead of forcing EWA into a framework that doesn’t fit, Cooney’s bill recognizes that EWA is fundamentally different from lending and regulates it accordingly.

It also preserves access. Workers can continue using a tool that helps them manage cash flow, avoid late fees, and stay out of debt, now with the added benefit of clear rules and oversight.

Cooney is showing what smart financial regulation looks like. He’s protecting consumers, encouraging innovation, and expanding access to better options, not shielding incumbents from competition.

Adam Kovacevich is the founder and CEO of the tech industry coalition Chamber of Progress. He has worked at the intersection of tech and politics for 20 years, leading public policy at Google and Lime, and serving as a Democratic aide on Capitol Hill.

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Earned-wage access rules should protect consumers, not credit unions