DailyPay Secures $200M in Second Asset-Backed Securitization to Scale On-Demand Pay

DailyPay has secured a $200 million asset-backed securitization of its on-demand pay receivables, marking its second foray into the ABS market. For fintech professionals, this transaction signals the maturation of earned wage access as a legitimate asset class, providing the liquidity necessary to scale payroll flexibility for millions of workers across the enterprise landscape.

What was announced

The $200 million transaction represents DailyPay’s second asset-backed securitization (ABS) issuance, following an initial $200 million deal completed in June 2025. This latest issuance, finalized in October 2026, brings the company’s total secured debt financing to approximately $1.4 billion. This total includes a $960 million secured credit facility alongside the two ABS rounds. DailyPay remains the only provider in the On-Demand Pay sector to access the ABS market, a move that broadens its funding base and reduces the cost of capital.

The offering was structured into four classes of notes—Class A, Class B, Class C, and Class D—all of which were rated by Morningstar DBRS. The ratings assigned to these notes ranged from AA (sf) to BB (sf). Citi served as the lead bookrunner and structuring agent for the deal, supported by joint bookrunners Bank of America and Barclays. Co-managers for the transaction included KeyBanc, Scotiabank, and Wells Fargo. Legal counsel was provided by Latham & Watkins LLP for DailyPay and Mayer Brown LLP for the bookrunners.

The capital is specifically designated to support the scale of DailyPay’s platform, which currently serves more than 2,000 employers and over 6 million employees. The system allows employees to access pay they have already earned before the traditional payday, with DailyPay funding the transfers to ensure there is no impact to employer cash flow or existing payroll processes.

"Employers are increasingly embracing On-Demand Pay as a meaningful employee benefit, driving our need for funding capacity to support our growth. The strong performance of our inaugural ABS supported another oversubscribed transaction, demonstrating continued investor demand for an asset class we pioneered helping reduce our cost of capital and broadening our funding base."

Deepa Subramanian, Chief Financial Officer, DailyPay.

The companies involved

DailyPay is a prominent player in the financial technology sector, specifically focusing on the "earned wage access" (EWA) or On-Demand Pay market. The company operates a platform that integrates with employer payroll systems to provide workers with real-time access to their earnings. This model is designed to replace traditional, rigid payday cycles with a more flexible liquidity option for the workforce, aimed at helping employees manage unexpected expenses without resorting to high-interest debt.

Headquartered in the United States, DailyPay has established itself as a leader in the category, evidenced by its extensive reach into the enterprise market. The company currently supports a diverse range of industries, from retail and healthcare to automotive services. Unlike many startups in the space that rely solely on venture capital or traditional credit lines, DailyPay has pioneered the use of the asset-backed securitization market to fund its operations. This move into the ABS market indicates a level of institutional trust and financial sophistication usually reserved for more established financial services firms. With 72 previous reports by FF News covering their various partnerships and product launches, DailyPay remains one of the most frequently cited companies in the evolution of modern payroll technology.

What FF News has reported before

FF News has closely tracked DailyPay’s expansion and its impact on workforce retention over several years. In late 2025, we reported how Quality Automotive Services Increases Employee Tenure by 32% Through Partnership with DailyPay, highlighting the tangible ROI for employers. The company has also focused on strengthening its leadership team, as seen when DailyPay Names Caitlin Allen as Chief Brand and Communications Officer. More recently, the firm has addressed the specific needs of the deskless workforce, as detailed in Frontline Workers Demand Pay Clarity and Flexibility: New DailyPay & Workday Research. To further integrate into corporate workflows, the company also Launches New Payroll Deductions Method to Streamline On-Demand Pay for Employers, a move aimed at reducing administrative friction for HR departments.

What this means

This second ABS issuance is a watershed moment for the earned wage access industry. By securing an oversubscribed deal with ratings as high as AA (sf), DailyPay has effectively de-risked the concept of "on-demand pay" for institutional investors. This puts significant pressure on competitors who still rely on more expensive or less scalable forms of debt financing. The move suggests that the broader financial market is shifting away from viewing EWA as a niche startup perk and toward treating it as a standard, reliable financial product. However, the sector still faces industry-wide questions regarding long-term regulatory frameworks and how these securitized assets will perform during broader economic shifts in employment levels.