Americans prefer payroll cards to paper checks because the former help employers and employees save time and money. Payroll cards allow employers to just electronically deposit funds into a card.
Why Do Americans Prefer Payroll Cards?
More and more Americans are turning to payroll cards. In 2014, 6 million US employees received their wages using payroll cards. By 2019, this number is going to double. Payroll cards are the preferred choice for about 68 million Americans. These are people who are unbanked/underbanked, and may not possess a checking account so to be able to directly deposit wages to it.
According to Brad Fauss, President and CEO of the Network Branded Prepaid Card Association (NBPCA), payroll cards enable employers to serve their employees better and provide more efficiency for their business.
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Payroll Card Benefits for Employees:
Payroll cards help employees:
- Access Wages Immediately
Payroll cards allow for immediate access to your wages. No paper check is required and you don’t have to carry large sums of cash. Moreover, at least once per pay period, payroll cardholders can access their full wages without paying any fees.
- Manage Money
Many prepaid cards, such as payroll cards, come with built-in features that enable users to manage funds. This means you can use budgeting tools and have online/mobile access to keep you funds under control.
- Protect Wages
Thanks to the safeguards of Regulation E protection and FDIC insurance, payroll cards ensure your funds will be protected in case the card is compromised, lost, or stolen.
- Save Money
Employees can save $150-$200 annually if they choose payroll cards instead of a check cashing service or a basic checking account.
- Use Money on the Spot
As soon as your wages are disbursed to a payroll card, you can immediately use them. You
mustn’t necessarily be in the office to collect your checks. Also, you aren’t obliged to wait to cash a check and pay bills or make electronic payments spending your time and money.
- Use Payroll Cards Almost Everywhere
You mustn’t necessarily stop at the ATM before paying your bills or do some shopping. You can use your payroll card wherever you use your debit cards, including online stores.
Payroll Card Benefits for Business Owners
Payroll cards help employers:
- Reduce Payroll Processing Costs
Payroll cards help businesses save up to 65% in administrative costs. This is thanks to simplified payroll process, reduced time to manage payroll, decreased paperwork, and other benefits.
- Reduce Check Fraud
Depositing funds directly into your employee’s payroll card account mitigates that risk of falling victim to check fraud.