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Special Report: New apps let you access your funds before pay day but are they worth it?

Special Report: New apps let you access your funds before pay day but are they worth it?


CBS 58 -- "Early payday apps" means you don't have to wait until the check arrives, but are they too good to be true?

"Emergencies always pop up and they pop up when you least expect them," Jamil Mangan, a DailyPay user said. Mangan is one of more than 100,000 people using DailyPay, an app that allows workers to tap into their current earnings, days ahead of payday.

"I use it probably twice a month, in times that I'm sort of in a bind and I need some cash for the metro or a cable bill comes in," said Mangan.

"Our users range from the minimum range hourly employee all the way up to someone who makes 6 figures a year," said Jason Lee, CEO of DailyPay.

DailyPay is just one of several instant-pay apps that are partnering with employers and their employees.

"This is not folks trying to buy a new flatscreen tv...this really is 'hey, I've got rent coming and I'm just $80 short'," said Lee.

But, it does come with a fee. Instant transfers are $2.99 and next day transfers are $1.25.

Cheryl Maranto is an Associate Professor of Management at Marquette University. "Well, at least it's better than payday lenders which are the Scrooge of the earth."

She says how people use the app is the main decider for her but she doesn't like how, in her opinion, it's a way to make unliveable wages more viable.

"Part of my concern is that it normalizes doing this on a regular basis. If you need to withdraw money early on a regular basis, there's a fundamental problem that just accessing your money is not going to solve," Maranto said.

 DailyPay is only available to workers whose companies have decided to partner with the app.

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