With over half of UK families unable to afford a £250 unplanned expense, Wagestream says that it wants to end the 'payday poverty cycle' that has let the likes of Wonga flourish in recent years.

A major reason for so many people struggling towards the end of the month is that the vast majority of Brits - unlike Americans - are paid monthly.

Wagestream is promising to help solve this by letting people access their 'earned income' at any time during the pay cycle. An app shows each employee how much they have earned for each hour worked and lets them transfer these earnings instantly to their current account for a one-off fixed fee of £1.75. The money is then deducted from the next wage packet.

The service can be implemented by companies without impacting cash-flow, payroll or timekeeping processes, says Wagestream, which has signed up more than 20 firms employing 20,000 people to a pilot.

The company has raised more than £4 million in funding from, among others, Village, a VC backed by big name tech billionaires such as Bill Gates and Jeff Bezos.

Peter Briffett, CEO, Wagestream, says: "As we mark the death of one of the payday loan giants, we’re pleased to finally present a viable solution to help give the UK’s workforce the financial freedom they deserve.

"While the wider and long outdated issue of monthly pay cycles is in desperate need of modernisation, for far too long legal loan sharks have been exploiting the most disadvantaged consumers with crippling high-cost loans. By giving workers access to their earnings, they can prevent themselves from going into overdraft, credit card debt or the worst case, applying for a payday loan."