Sometimes you’re a little short on cash and your payday is just days away. What financial tool could help you in such a situation? The Earnin app could be the solution to help you stay on track with your finances.

An alternative to payday loans, the Earnin app promises to give you “access to the paycheck you’ve earned, whenever you want it”. Let’s move on to our Earnin app review and find out if this new service can help you when you’re a bit short on cash.

What is the Earnin app?

Earnin, officially known as ActiveHours, is a payday advance service that aims to bring you the money you’ve earned before your payday. We have seen these types of services before in the form of terrible payday loans. You need more money before your salary arrives, so you borrow money from a service that then charges you usually outrageous interest rates.

This is where Earnin stands out; the interesting catch is that you don’t have to pay anything for the service as the whole business model is based on voluntary tipping. Seriously; you can request to borrow up to $500 before your next paycheck, then when you get paid, Earnin automatically withdraws the borrowed money from your bank account.

But, is it easy to get money from the Earnin app, do you need to be qualified to use the service, and is it really better than the cost of a payday loan? Read on as we explore exactly how the Earnin app works.

How does the Earnin app work?

The Earnin app works by analyzing how long you work and giving you quick access to your paycheck before your typical payday. Let’s explore some of the basic concepts of the Earnin app to help you better understand if it’s the right service for you.

We’ve answered some of the most common questions users have about Earnin, and hands-on the app to form our own opinion.

How do you qualify for the Earnin application?

Don’t worry, Earnin doesn’t track your credit score like a personal loan or payday loan. In fact, Earnin plays the financial game a little differently in several ways. The Earnin app just needs to know that you have a job with a regular pay schedule to qualify. But how does Earnin know you’re working?

When you join Earnin, you must connect the service to your current account. From there, Earnin will be able to see exactly how much you earn, well, by direct deposit.

You will need to ensure that more than 50% of your direct deposit is sent to a current account. If that’s not the case, for example, you get paid via old-fashioned paper checks or split your salary between multiple checking accounts, the Earnin app isn’t for you, sorry folks.

Then you’ll need a consistent pay period, as we mentioned, like getting paid weekly, bi-weekly, semi-monthly, or monthly (a paycheck-to-paycheck cycle ). If you have an odd pay schedule or are not paid regularly, as is the case with many freelancers, you will not be eligible for service.

Finally, you’ll need a fixed workplace (like a physical office building), an online timekeeping system, or a paper timesheet. Earnin needs to know you’re going to work one way or another, either by tracking your time in the office through the smartphone app or by checking official records.

How much does the Earnin app cost?

Earnin has no mandatory fees and relies on voluntary tips from the community – seriously, there’s no trick here. When you choose to borrow money from the service, you can choose to tip up to $14 or not tip at all; it’s your call.

The tips help keep the service running smoothly, and apparently the company has been working well on this model since its inception in 2013. It’s a pretty reputable payday loan alternative!

What we can say for sure is that in our testing we were happy to tip a few dollars to the service as a voluntary “thank you” and the tip amount was a much lower percentage than the loan services on typical salary.

But, if you don’t want to tip anything, you are free to do so. It’s also essential to note that your tipping rate does not affect your Max, the maximum amount of money you can request to borrow per pay period. But, speaking of your Max…

How much can I borrow on the Earnin app?

The Earnin app has two maximums that you should keep in mind. The first Max is your Daily Max, which is the same for all members – $100. Members cannot request to borrow more than $100 per day from Earnin.

The second maximum is your maximum pay period, and it dictates how much money you can borrow between pay periods. Depending on several factors, your maximum pay period can vary from $50 to $500.

Earnin isn’t 100% upfront with how they calculate your maximum pay period; the company simply states that “your Max pay period is determined based on a number of factors which we believe relate to an assessment of your financial health.”

There are a few clues about what determines your financial health, such as how often you maintain a positive checking account balance, whether you spend less money than you earn, and whether you repay loaned money on time.

Overall, Earnin’s financial health criteria doesn’t seem to be much different from what we would suggest with a good personal finance plan – just avoid these bad financial habits to increase your pay period limit.

How long does it take to get money with Earnin?

If you want to get some quick cash from the Earnin app, you’ll want to sign up for the Lightning Speed ​​feature, which simply involves linking an eligible debit card to your account. With a debit card attached to Earnin, you can request and access cash in minutes.

If you choose to use Lightning Speed, you’ll be charged a fee (it’s one of the few fees for the service) for your convenience. The fees for using the service range from $1.99 to $3.99, depending on the amount of money you are trying to withdraw to your bank account.

If you don’t have access to the Lightning Speed ​​feature or don’t want to use it to avoid fees, your loan transfer will take the industry standard 1-3 business days to be transferred to your account. fluent. So you’ll have to decide which is more important, saving a few dollars or having instant access to your loan.

Earnin App Alternatives

If you’re not too fond of the Earnin app, there are a few other non-personal loan alternatives you might want to try instead. However, we also have a list of personal loans you may want to consider, if applicable.

Here are two options we recommend alongside Earnin so you can find the best app to lend you some cash before your next payday.

Frequently Asked Questions (FAQ)

Michael Archambault is a senior technology writer for The Penny Hoarder.

This was originally published on The Penny Hoarder, a personal finance website that empowers millions of readers across the country to make smart decisions with their money with practical, inspirational advice, and resources on how to to earn, save and manage money.