*Research Brief Financial Security

Employer-sponsored small-dollar loans: An assessment of take-up, engagement, and outcomes

This is one research brief in a series of five completed through the Employee Financial Wellness Programs Project. In this study, we focus on an employer-sponsored small-dollar loan (ESSDL) product, TrueConnect loans, aimed at providing employees an affordable credit alternative to payday, auto title, and other high-cost loans. We present and discuss results of our analysis of survey and interview data to capture employee and employer ESSDL experiences. The TrueConnect loan program offers small-dollar payroll-deducted loans through participating employers, providing workers with an alternative to high-cost loans. For employees who lack access to traditional financial services or who may not qualify for loans during financial difficulties, employer-sponsored loan programs provide a source of credit that is likely otherwise unavailable. TrueConnect loans help employees cover basic needs, likely reducing the risk for destabilizing hardship events. Employees perceive their employers positively as a result of having access to the loan program and experience peace of mind knowing that loans are available should they encounter financial challenges. Further, payroll deducted loan payments help establish a consistent payment history that will have a positive effect on credit scores. Finally, TrueConnect offers clients the option of pairing their loans with financial counseling provided by a non-profit partner to help employees address fundamental financial challenges that these loans alone cannot solve, a solution that may be valuable for these workers.

Project: Workforce Financial Stability Initiative


Frank-Miller, E., Fox-Dichter, S., Wolter, S., Hampton, J., Despard, M., & Germain, G. (2019). Employer-sponsored small-dollar loans: An assessment of take-up, engagement, and outcomes. (SPI Research Brief No. 19-04). St. Louis, MO: Washington University, Social Policy Institute.