A powerful cross-party group of MPs has issued a damning indictment against supermarket giant Asda and its financial technology partner, Wagestream, accusing them of potentially exploiting their own workforce with high-cost credit products.
The House of Commons Treasury committee’s investigation reveals that the much-touted ‘Earned Wage Access’ (EWA) feature, marketed as a financial wellbeing tool, can function as a high-interest loan. The report highlights that employees accessing their wages early are being charged fees that equate to an alarming Annual Percentage Rate (APR) of up to 365%.
Buy Now, Pay Later: A Debt Trap for Staff?
Beyond early wage access, the MPs expressed significant concern over the integration of a ‘Buy Now, Pay Later’ (BNPL) scheme directly within the staff app. This move is seen as a direct targeting of Asda’s predominantly low-income employees, potentially encouraging them to accumulate debt on essential items like groceries.
Committee chair, Dame Angela Eagle, was unequivocal in her criticism, stating the services could be "causing real financial harm to those who are already struggling". The report urges the Financial Conduct Authority (FCA) to urgently assess whether these EWA products constitute regulated lending, a move that would bring them under stricter regulatory scrutiny.
Asda and Wagestream: A Defensive Stance
In response to the fierce criticism, both companies have defended their practices. An Asda spokesperson emphasised that the app’s tools are "optional" and designed to offer employees "greater flexibility and control over their finances".
Wagestream countered the APR claims, arguing that the comparison to a traditional annualised loan rate is "misleading" because the fees are for short-term advances of already-earned wages, not long-term borrowing.
Despite these defences, the committee’s findings have ignited a fierce debate on corporate responsibility and the ethical boundaries of financial technology targeted at vulnerable employees.
