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Enter solutions like PayActiv, which specializes in what Shah called "earned wage access." Workers pay a flat fee to buy a membership for a given pay period that allows them to access a portion of the pay they've earned during that pay period as well as a host of other services, including a bill pay function, savings function and discounts.

Typically, payday loans charge $15 for every $100 borrowed. Bank overdraft fees often cost about $35. In contrast, PayActiv charges $5 per pay period when an employee uses the service, which also includes financial counseling and online bill payments.

You might start wondering why, in today’s digital age, you have to wait 14 days to get paid for work you did two weeks ago. Well, our guest—a rocket scientist-turned fin-tech-entrepreneur—says there’s no reason employees should have to wait. It’s their money, Safwan Shah says, and they should have access to it on demand. And if they don’t, the employer is essentially using the employee as a source of credit for itself, and at zero interest no less.

Nonbank lenders, including startups, all claim to be providing a valuable service to the underbanked. But distinguishing the helpful from the predatory can be extremely difficult.

If you labor in lower-income positions, including part-time "gig" jobs, the trend is toward getting pay into the hands of workers faster — often within a day or two of completing a shift. "As a society, we want everything — food, movies or whatever — in real time, so why can't payroll be on demand, too?" asked Ijaz Anwar, chief operating officer at PayActiv.

Employees can use a smartphone app to download their money onto a Visa debit or preloaded card, or even a traditional credit card. That also helps workers who do not have access to a traditional checking account.

“Our ability and agility to seamlessly integrate into businesses pre-existing systems allows for an execution” that banks are unable to accomplish, Ijaz Anwar, PayActiv’s co-founder and chief operating officer. PayActiv has also partnered with community banks and credit unions to offer wage advances to financial institution’s employees.

Think about that for a minute. According to the Federal Reserve, 40 percent of Americans don't have $400 in savings to fix their water heater or some other emergency. But Shah says they're spending around $2,000 a year on fees and interest to get emergency short-term cash. He thought this was a problem that needed fixing.

Last week, PayActiv announced its service will now be available to more than 600,000 employers that work with payroll giant ADP. Shah said his deals with ADP and Employee Loan Solutions’ tie-up with Brightside show there’s growing acceptance among employers that the best way to help financially stressed employees is not to lecture them about budgeting or savings but to offer them services that solve immediate problems. “If somebody is hungry, do you give them a diet book or a meal?” he said. “At some point, you have to do something real.”

More than 50 million Americans in low-income working families struggle to manage everyday cash flow. “… Walmart, one of the largest employers of low-wage workers, recently made PayActiv available to its employees. From December to March, 80,000 Walmart employees received more than $30 million through PayActiv." - Todd Baker and Snigdha Kumar.

If these fintech products were widely available, they could benefit virtually all of the nation’s 10.4 million low-income working families and, indirectly, the 47 million individual members of those families.

Goodwill is using technology from PayActiv, a start-up in San Jose, Calif., that uses employers’ wage and hours information to estimate their employees’ earnings. For a fee of $5 per transaction — of which Goodwill pays half as a courtesy to its workers — PayActiv advances the cash. On payday, it recoups the money directly from the employer. PayActiv’s founder, Safwan Shah, talks with a missionary zeal about the potential impact. “The biggest bank in this country is the bank of the employer, and two to three weeks of salary for most people is stuck there,” he said. “This is a corporate responsibility issue.”