Contents tagged with Payroll Cards

  • What you need to know before paying your employees with direct deposit paycards

    This year, more people will be paid with paycards than paper checks, according to new research from Aite Group. By 2019, the study predicts, the number of workers compensated via paycard will jump from 7 million up to 12 million while those who receive paper checks will plummet from 6 million to 2 million.

    The shift comes as more and more employers are recognizing the advantages of distributing paycards rather than paper checks, for both themselves and their employees. For businesses, paycards represent a massive savings opportunity, costing about $0.35 for a payroll deposit, compared with $2.00 for a paper check, according to a study released by the New York Attorney General's (NYAG) office last year. Researchers also found that employers that switched to payroll cards … more

  • New York attorney general backs payroll card regulations

    New York is looking to regulate payroll cards with a new bill.

    Earlier this month, this blog covered a bill that is currently working its way through the Illinois state government that would clarify the parameters for companies using direct deposit payroll cards as a way to pay employees. Now another state is getting on this bandwagon.

    According to recent article from The New York Times, New York's attorney general Eric Schneiderman is taking up a battle to regulate the use of payroll cards through a new piece of legislation. The goal of the bill is to protect employees as there is concern that low wage workers can be unfairly targeted.

    "The goal of this legislation is to move past the stage where we're trying to chase down individual employers with laws that were not written with payroll laws in mind," Schneiderman told the news source.

    He went … more

  • Illinois to recognize payroll cards as proper wage payment method

    In the business marketplace, more employers are starting to get on the bandwagon of offering direct deposit payroll cards as a way to pay their employees. It is a way to offer workers greater financial access and inclusion by essentially offering electronic payment options to those that do not have a back account. 

    According to a recent article from The National Law Review, the Illinois Legislature has recognized payroll cards as a legitimate method of wage payments.

    House Bill 5622 amends the Illinois Wage Payment and Collection Act (IWPCA) to expressly mention payroll cards, something that was not explicitly mentioned before. As currently written, the IWPCA only recognized cash, check and direct deposit. Last year, the Illinois Department of Labor issued a report that … more

  • Understanding the confusion between payroll and prepaid cards

    There is still much confusion when it comes to paycards.

    One payment method that has been hanging in the background for some time is the use of prepaid and paycards. While prepaid cards are more in line with what are  commonly thought of as gift cards, paycards can be issued from a payment solution provider and contain some or all of a paycheck.

    A recent article from PYMNTS examined comments made by Scott Schuh, director of the Federal Reserve of Boston's Consumer Payments Research Center, in a recent podcast. He spoke about payroll cards and prepaid cards and said that there is still a great deal of confusion when it comes to these cards, their differences and how they work in the payments industry. 

    "We have found that surveying consumers about prepaid cards is extraordinarily difficult. It's harder than any other … more

  • Examining the benefits of payroll cards

    There are countless ways for individuals to be paid for their work. While it may seem like a straightforward process, there are several options at the disposal of both businesses and employees. One of the more interesting ways is the use of payroll cards.

    A recent article from the Huffington Post touts the benefits of payroll cards, especially for workers who may be in financial need. While it could seem like every employee has a bank account for direct deposit, that is not always the case, meaning a different system is needed.

    "Most workers with established credit and banking services receive their wages via direct deposit, so that their wages are credited to their bank account," the article reads. "For workers without bank accounts, however, this is not an option. … more

  • MasterCard releases new standards for payroll card systems

    MasterCard has released new standards for direct deposit paycards.

    If you are a business owner who used direct deposit paycards as a way to pay employees, there is big news shaking up the industry for you to be aware of. 

    According to a report by the ABA Banking Journal, MasterCard has released new standards to help employees take full advantage of the benefits of payroll card programs. These will require anyone offering this option to provide greater transparency on fees and educational resources. On top of that, there must be a free way for users to check their balance.

    "Payroll cards serve as one way to bring the traditionally underserved into the financial mainstream," Ron Hynes, group executive, Global Prepaid Solutions, MasterCard, told the news source. "These standards will help ensure that employees not only understand the … more