Payroll Debit Cards
Providing a paycheck either through direct deposit or a hand-delivered, printed version is the traditional method of giving employees their earned pay. What if you have an employee who does not have a bank account? Some small businesses utilize workers who cash paychecks each pay period rather than make deposits. For those employees, and for the security of your company, payroll debit cards are an excellent alternative.
What is a Payroll Debit Card?
A payroll debit card functions much like an ATM card. Employers electronically transfer earned pay each period to the employee’s payroll debit card account. The employee may then access his or her account using the card.
How Does a Payroll Debit Card Work?
There are several options for loading earned pay on payroll debit cards:
- As a standard direct deposit ACH transaction
- As a non-ACH funds transfer
- Directly to card account
- Government payments deposited to payroll card
The card is connected to an account that records the earned money in and out as it occurs, so the balance is always current.
What are the Benefits of a Payroll Debit Card?
To Employers:
- Eliminates paper checks along with associated costs
- Ease of combining and producing termination pay, exception pay and expense reimbursements
- Reduces problems of distributing paychecks to employees in multiple or distant locations
- Increases cost-savings available under direct deposit payments to all payroll payments
To Employees:
- Account cannot be overdrawn
- Security through PIN-based accounts
- Ease of fund transfer from one payroll debit card to another
- No fees often associated with check cashing
The debit card sector is the fastest growing element of the card services industry. The payroll debit card is easy for employers and employees. The results for both are effective time management, increased security and significant cost-savings.