In this guide, we’ll explore the differences between on-demand payments and salary advances, assess the true cost to employers, and look at some of the benefits that this approach can bring to your business.
What is on-demand pay?
On-demand pay (also known as pay on demand) is a system that allows employees to access a portion of their earned wages before their scheduled payday. Rather than waiting until the end of the pay cycle, staff can withdraw money that they’ve already earned, without it being a loan or credit product.
Unlike a salary advance, on-demand payments don’t rely on employer discretion, formal requests or loan-style repayments. They simply allow access to funds that have already been accrued.
How do on-demand payments work?
On-demand payments are not loans or advances. Employees can only withdraw money that they’ve already earned. The available amount is calculated based on the hours or shifts an employee has completed within the current pay cycle, usually factoring in deductions like tax, National Insurance and pension contributions. Employers typically set a limit on how much can be withdrawn, often up to 50% of earned wages, to make sure there’s enough left for final payroll.
To access these on-demand payments, employees use a dedicated app or online portal like Access PayWise+. Once their accrued earnings are verified, they can request a withdrawal instantly, with no need for formal approval or paperwork. These solutions integrate directly with payroll and time and attendance software, so there’s no extra admin for HR or finance teams. The platform automatically calculates available earnings, handles employee requests, and provides full visibility of payment activity.
Since implementing PayWise+, 89% of our team say they feel increased loyalty to our company. It's become our most valued employee benefit.
On-demand pay vs salary advances: What’s the difference?
While both on-demand payments and salary advances allow employees to receive money ahead of payday, there are important differences that matter for employees and employers. Whether you’re reviewing your payroll processes or looking to boost financial wellbeing in your workforce, understanding how they compare is essential to choosing the right approach for your business. We’ve put together a breakdown to help you to weigh up your options.
| Feature | On-demand pay | Salary advance |
| Cost to business | Often offered at little or no cost to employers when facilitated through a third-party platform. Some solutions are employee funded or charge a small fee per withdrawal. | Can have a higher financial impact as the employer typically fronts the funds directly. This can affect cash flow and risks financial loss if the employee fails to repay the loan. |
| Administrative burden | Minimal administrative input. Integrated platforms like Access EarlyPay automate the process and sync directly with payroll systems for accurate calculations and fast payments. | Time-consuming to administer. HR or payroll teams must manually calculate, approve and process the advance and the repayment, creating extra work. |
| Risks and liabilities | Low financial risk to the employer as only already-earned wages are accessed, not future pay. | Higher risk if repayments aren't made or if advances are disputed. The employer is responsible for chasing repayments if an employee leaves before repaying. |
| Employee experience | Provides a simple, fast and discreet way to access earned wages. Reduces financial stress and supports financial wellbeing without stigma. | May feel like borrowing from the employer. Employees often need to justify requests, which can create discomfort and affect morale. |
PayWise+ is the first benefit our employees actually thank us for. We've seen a significant reduction in financial stress-related absences and our retention rates have improved dramatically.
What is the real cost to businesses for on-demand payments?
While some businesses worry about the cost of offering on-demand pay, the reality is that traditional salary advances often carry far greater operational, financial and cultural burdens. Here’s a breakdown of the true cost of each model.
Financial costs
Offering on-demand payments typically doesn’t require businesses to front the money themselves. Providers like Access EarlyPay handle the float, which removes the need to divert company cash flow or reserve budget to cover early payment requests. While some on-demand pay solutions carry modest per-user fees or platform costs, these are often outweighed by the time and productivity savings that they deliver.
By contrast, salary advances require employers to absorb the cost of fronting the payment internally. This is a riskier approach as it takes funds away from operational budgets payroll, leading to less predictable cash flow.
Operational costs
Manual salary advance schemes are time consuming for HR and payroll teams. They require employee requests to be submitted, reviewed, approved, tracked and manually entered into payroll, adding administrative complexity and increasing the risk of human error. This all adds up to time and money spent on repetitive tasks that could be better used elsewhere.
On-demand payments, on the other hand, are automated. They remove the need for case-by-case approvals and integrate directly with existing payroll, accounting and time management systems. This is especially beneficial for employers in industries managing large, shift-based workforces, where calculating pay can already be resource intensive.
Cultural costs
Traditional advances can create inconsistent experiences and may lead to resentment if one employee’s request is approved and another’s isn’t. They also carry stigma, as employees may fear being perceived as struggling financially if they need to ask for money in advance.
Pay on demand systems empower employees to manage their own earnings, normalising financial flexibility and promoting a sense of autonomy and trust. This can have a direct impact on employee satisfaction and retention, reducing the hidden costs of disengagement, absenteeism and churn.
The integration with our existing Access systems was seamless. Our staff love the AI guidance, it's like having a personal financial advisor in their pocket.
The impact of on-demand pay on productivity and retention
Financial stress is one of the biggest drivers of workplace disengagement. According to CIPD’s 2025 Good Work Index, 31% of employees said that money worries had negatively affected their performance at work. The impact for employees include lost sleep due to worrying (19% of all employees), health problems such as stress (15%), and finding it hard to concentrate or make decisions at work (11%).
By supporting employee financial wellbeing by offering on-demand pay, productivity, focus, absenteeism and turnover can improve, creating a more stable, motivated workforce. When employees feel financially supported, they’re more likely to stay in the long term, strengthening team continuity and reducing turnover. This in turn leads to lower recruitment costs for businesses and higher output per employee.
Unlock the business value of on demand payment
Financially resilient employees are more productive, loyal and engaged. By offering on-demand pay, businesses not only remove the administrative burden of salary advances but also support long-term growth through higher retention and performance.
With Access PayWise+, businesses can offer flexible on-demand payments that integrate seamlessly with existing systems, reducing admin, removing financial risk, and boosting employee satisfaction. To see how Access EarlyPay can support your workforce, get in touch with our team and we’ll be happy to advise you.
FAQs
What is on-demand pay?
On-demand pay is a system that allows employees to access the wages that they’ve already earned before payday. It’s not a loan and doesn’t involve interest or debt; it simply gives staff access to the money they’ve earned, as they earn it.
Is on-demand pay the same as a salary advance?
No. Salary advances are manual payments that are typically requested by employees and approved by HR. They often require employers to front the money, making them financially risky. On-demand pay is automated, app-based, and uses real-time payroll data to release accrued earnings without the need for manual approval.
Does on-demand pay cost the employer money?
Not usually. Most on-demand pay platforms operate on a low-cost, per-user basis or are funded by employee usage fees. Unlike salary advances, they don’t require the employer to front cash or manage debt.
How can on-demand payments improve employee productivity?
By reducing financial stress, on-demand pay helps employees to focus better at work, feel more secure, and encourages them to stay with their employer longer. This leads to increased productivity, lower absenteeism, and improved retention, all of which have a direct impact on business profits.
Is Access PayWise+ the same product as Access EarlyPay?
PayWise+ is the next generation of EarlyPay. It keeps earned wage access and adds AI‑powered financial wellbeing features (smart budgeting, savings pots, retail discounts).
How much of pay can employees access with PayWise+?
Employees can access up to 50% of their earned wages instantly, with no interest and no hidden fees shown by the platform.
Does PayWise+ affect employer cash flow or payroll complexity?
When an employee withdraws earnings, PayWise+ sends the money to the employee and automatically logs the withdrawal and any fees in your payroll system. You then run payroll as usual. The net payment is reduced by the withdrawn amount. This keeps admin and cash‑flow disruption low.
How should employers report on‑demand pay under HMRC RTI rules?
From 6 April 2024, where certain conditions are met, HMRC allows employers to report a salary advance/EWA on the normal payday (one FPS) rather than reporting each advance separately, simplifying RTI for employers (including where a third‑party provider acts on the employer’s behalf).
What happens if an employee leaves before the next payday?
Amounts withdrawn through PayWise+ are automatically deducted from the next payroll (including a final payroll for leavers), with the integration handling the accounting entries and reducing manual chasing. The app store listing also confirms withdrawals are deducted from the next pay cheque.
Does PayWise+ work for shift‑based or zero‑hours teams?
Yes. PayWise+ tracks real‑time earnings and integrates with Access People Hospitality, helping employers manage onboarding, leavers, monthly withdrawal limits, and exports to payroll, ideal for shift‑based workforces.