What is the Income Advance Program?

Income Advance offers employees quick access to small dollar loans, directly from Midcoast Federal Credit Union. The key data point used to underwrite Income Advance loans is the borrower’s stable employment – because of this criterion, the loans are often referred to as Employer Sponsored Small Dollar Loans (ESSDL). But not all ESSDLs are created equal.

The Key requirements of Income Advance are:

• Employer Sponsored Eligibility
• 15.00% APR* Cap (APR = Annual Percentage Rate)
• $1,500 max loan amount
• 12 month payback period
• Loans are repaid through automatic payroll deduction each pay period
• After the loan is fully repaid, payroll deductions will automatically continue as deposits
  into the employee’s Midcoast FCU savings account, unless the employee requests to stop them

The Gold Standard

While the core parameters provide a solid framework, our gold standard principles go beyond basic requirements to make meaningful impact:

1) Accessibility & Inclusivity: We will perform a credit check only to determine if an employee qualifies for better offerings. Removing barriers such as credit qualifications and complex eligibility criteria means easy access for all employees. We advocate for simply “good standing employment” allowing funds to reach employees within 24 hours of application.

2) Affordability: With a maximum 15% APR inclusive of all fees and interest, the program provides manageable solutions without adding financial burdens. Total interest typically amounts to $75-$130 over the 12 month loan life—substantially lower than credit cards, payday loans, and other alternatives that often carry triple-digit APRs and hidden fees.

3) Transparency & Fairness: All terms are clearly communicated with no hidden fees or surprise charges. This straightforward approach builds trust and helps borrowers feel confident in their decisions.

4) Long-Term Impact: Beyond temporary relief, the program builds financial foundations and credit history. We advocate for continued paycheck deductions after loan repayment to flow into savings accounts, helping employees tackle future expenses and reduce financial stress.

Income Advance Stability for Businesses & Employees

Employer Benefits

Reduce Turnover: Ensure stability in the lives of employees and their ability to make it to work.

Boost Productivity: Employees facing financial stress are less productive and engaged.

Build Trust: Foster a sense of trust and reliability between employers and employees.

Improve Culture: Promote a supportive workplace culture, enhancing overall employee well-being,
engagement, morale and job satisfaction.

Employee Benefits

Access to Safe Emergency Loans: Employees have immediate access to safe and reliable
emergency loans, preventing the need to resort to predatory lending practices.

Improve Credit: Successful repayment is reported to credit rating agencies, helping employees
establish or improve their credit scores.

Build Savings: Once the loan is repaid, employees can continue automatic payroll deductions into their Midcoast FCU
savings account for future emergencies.

Reduce Financial Stress: Positively impact employees’ mental health, productivity,
engagement, and overall well-being.

The Impact of Employee Stability on Business Stability