Payroll Cards

Payroll Cards Are The Modern Way to Pay

Payroll cards offer big benefits to businesses. Reliable and proven, payroll cards are the fastest growing and most preferred method of sending and receiving payments worldwide.

Explosive Growth in Payroll Cards

According to the Pelorus Group, an independent research firm, there were 7 million payroll cards in circulation in the US in 2006. This is represents more than a three-fold increase from the 2.2 million cards in circulation in 2004. The number of US payroll cards is expected to increase to 17.5 million in 2010. Research done by the Aite Group projects spending on payroll cards will soar to $27.1 billion by 2009.

Prepaid debit cards are experiencing exponential growth. Currently international payments using stored valued cards are estimated to be over $2 trillion.

What is a Payroll Card?

A payroll card is a reloadable debit card. Other names for payroll cards are stored value cards, paycards, payroll debit cards, electronic paycards, or simply debit cards. Cards can be branded with card association marks.

Companies use payroll cards to electronically disperse money to employees, affiliates, and distributors. Types of payments commonly placed on cards are wages, commissions, residuals, reimbursements, per diems, advances and termination pay.

Payroll cards are popular for US workers. International debit cards are embraced by workers worldwide

Streamline Business Operations with Payroll Cards

Paperless payroll is part of the electronic payments revolution. Paying workers by payroll debit cards is the wave of the future. The cards are the final frontier in the move to totally electronic payroll systems.

For years, employers seeking to reduce paper and automate accounting functions have encouraged workers to accept payment via ACH direct deposit. Therefore, most employers are already familiar with direct deposit to employees’ bank accounts. A payroll card works in a similar way to ACH direct deposit.

Payroll Card Direct Deposit

For employers, the funding procedure is the same, whether paying workers via direct deposit to a bank account or to a payroll card. With a payroll debit card, the direct deposit is placed on the payroll card rather than into a bank account. Companies that use payroll cards to electronically pay workers achieve cost savings similar to those already realized with the use of direct deposit.

Funds on payroll cards are accessible at ATMs or point of sale locations around the world. Workers enroll in the payroll debit card program using a simple authorization form. Workers receive payroll cards through the mail or from their employer. Card holders are required to provide proof of identification in order to comply with the US Patriot Act.

Payroll Cards are Cost Effective for Workers

A study conducted by the Federal Reserve Bank of Philadelphia, reported that for workers without banks accounts, payroll cards are the most cost-effective way to receive funds. The Community Affairs Department of the Comptroller of the Currency (OCC) estimates the total annual fees for payroll cards at $72 per year. Using a check casher to cash paper checks costs $246.48 per year. Fees for a basic bank account are $79.40 per year.

Workers report that the small fees associated with the use of cards are more than offset by the convenience and immediate accessibly to cash stored value debit cards provide.