A growing number of American workers are confronting a frustrating predicament on payday: To get their wages, they must first pay a fee.

For these largely hourly workers, paper paychecks and even direct deposit have been replaced by prepaid cards issued by their employers. Employees can use these cards, which work like debit cards, at an ATM to withdraw their pay.

But in the overwhelming majority of cases, using the card involves a fee. And those fees can quickly add up.

One provider, for example, charges $1.75 to make a withdrawal from most ATMs, $2.95 for a paper statement and $6 to replace a card. Some users even have to pay $7 inactivity fees for not using their cards.

Some employees end up making less than the minimum wage once the charges are taken into account, according to interviews with consumer lawyers, employees, and state and federal regulators.

Devonte Yates, 21, who earns $7.25 an hour working a drive-through station at a McDonald’s in Milwaukee, says he spends $40 to $50 a month on fees associated with his JPMorgan Chase payroll card.

“It’s pretty bad,” he said. “There’s a fee for literally everything you do.”

Many employees say they have no choice but to use the cards: some companies no longer offer common payroll options like ordinary checks or direct deposit.

At companies where there is a choice, it is often more in theory than in practice, according to interviews with employees, state regulators and consumer advocates.

“We hear virtually every week from employees who never knew there were other options, and employers certainly don’t disabuse workers of that idea,” said Deyanira Del Rio, an associate director of the Neighborhood Economic Development Advocacy Project, which works with community groups in New York.

Taco Bell, Walgreen and Wal-Mart are among the dozens of well-known companies that offer prepaid cards to their workers; the cards are particularly popular with retailers and restaurants. And they are quickly gaining momentum. In 2012, $34 billion was loaded onto 4.6 million active payroll cards, according to the research firm Aite Group.

Companies and card issuers, which include Bank of America, Wells Fargo and Citigroup, say the cards are cheaper and more efficient than checks — a calculator on Visa’s website estimates that a company with 500 workers could save $21,000 a year by switching from checks to payroll cards. On its website, Citigroup trumpets how the cards “guarantee pay on time to all employees.”

The largest issuer of payroll cards is NetSpend, based in Austin, Texas. Chuck Harris, the company’s president, says it attracts companies by offering convenience to employees and cost savings to employers.

“We built a product that an employer can fairly represent to their employees as having real benefits to them,” he said.

Sometimes, though, the incentives for employers to steer workers toward the cards are more explicit. In the case of the New York City Housing Authority, it stands to receive a dollar for every employee it signs up to Citibank’s payroll cards, according to a contract reviewed by The New York Times. (Sheila Stainback, a spokeswoman for the agency, noted that it had an annual budget of $3 billion and that roughly 430 employees had signed up for the card.)

Some employers and card issuers contend that the payroll cards are useful for low-wage workers who do not have bank accounts. They also say that the fees on the cards are usually lower than those associated with check-cashing services, which are often the only other option for people who do not have bank accounts.

“An unbanked employee is likely to be subject to a check-cashing fee when they try to cash a payroll check,” said Nina Das, a Citigroup spokeswoman. She said that “someone cashing a payroll check for $500 would end up paying $15 at a 3 percent check-cashing fee.”

This population — people who tend to use few, if any, bank services, is swelling. About 10 million households in the United States do not use a bank at all, up from 9 million four years ago, according to estimates from the Federal Deposit Insurance Corp. And 24 million households that do have a bank account still use expensive financial services like prepaid cards, the agency said.

For banks, looking to recoup billions of dollars in lost income from a spate of recent limits on debit and credit card fees, deals to issue payroll cards can be lucrative — the products were largely untouched by recent financial regulations. As a result, some of the nation’s largest banks are expanding into the business, banking analysts say.

The lack of regulation in the payroll card market, while alluring for some of the issuers, can potentially leave cardholders swimming in fees. Take the example of inactivity fees that penalize customers for infrequently using their cards. The Federal Reserve has banned such fees for credit and debit cards, but no protections exist on prepaid cards. Cards used by more than two dozen major retailers have inactivity fees of $7 or more, according to a review of agreements.

Some employees can also be hit with $25 overdraft fees, called “balance protection,” on some of the prepaid cards. Under the Dodd-Frank financial overhaul law, banks with more than $10 billion in assets are barred from levying overdraft fees on customers’ checking accounts.