Everyone loves it when payday comes around. What’s not to like? Your salary’s in, it’s time for that fancy meal or that pair of shoes you’ve dreamt about for the past month. What’s slightly annoying is you got your pay in the form of a paycheck. Now you have to swing by a branch of your bank and deposit the fruits of your blood, sweat and tears. It’s not very convenient, but there’s no other way.
Or is there?
How do employees get paid?
The old reliable. Paychecks have been printed on and written out to employees by their employers for a long time now. It’s still one of the most widely used methods of payment of wages and there are good reasons for that. Some employees who value their privacy might prefer to be paid with checks since that doesn’t require them to share banking information.
However, paychecks can get lost or stolen before they’re deposited or cashed out. Writing out checks individually for each employee can be inefficient and slow, especially if the headcount is high, though that can be somewhat mitigated by printing the details on the checks. It’s not a perfect solution though, as printers also require ink and maintenance and that right there are extra costs.
Direct Deposits (or interbank GIRO)
Generally speaking, this also comes as one of the most widely used payment methods not just in Singapore but in the world – as 82% of employees in the United States receive their wages this way. The employee on the receiving end of a direct deposit doesn’t need to be there (or anywhere) in person and it’s overall a fairly quick process. The trouble with direct deposits is if any employee has their bank account set up in a different bank than the one the employer, there might be fees for transfers. The recipient won’t necessarily receive their wages instantly too, and it could take up to 3 business days.
Not many people are paying and are getting paid for work in cold, hard cash nowadays. While it seems fairly straightforward to pay wages in cash, since it is cash, the recipient doesn’t have to wait, [lus, there’s no fees like transfers made with direct deposits. It’s not all sunshine and rainbows, though. Payments made in cash are more difficult to keep track of since they don’t have an automatic or digitised audit trail. This might cause further problems down the road when employers fail to report wages paid accurately when they’re doing their taxes.
This is basically a type of prepaid card that allows employers to load their employees’ wages onto. It can be used like a debit card to buy things and to withdraw cash from ATMs. What’s nice about payroll cards is that employees do not need to have a bank account to receive their wages. Money gets transferred from the company’s bank account onto the cards automatically every pay period. This is all well and good, but again, this payment method is not without its flaws. There are costs associated with payroll cards when the whole system is being set up and ongoing maintenance. Both employers and employees might also face fees whenever wages are transferred and when money is withdrawn.
Paying wages with a credit card?
What not many employers know is that they can actually be tapping on their credit cards using CardUp for payroll purposes. CardUp is a platform that enables the payment of big expenses using existing credit cards even where cards are traditionally not accepted, such as for the payment of rent, taxes, invoices and yes, wages.
How does it work?
Step 1: Sign up for a free CardUp account
Step 2: Schedule a payment, and select the Payroll payment category.
Step 3: Add your credit cards you’d like CardUp to charge your payments to
Step 4: Your credit card will be charged prior to your payment due date, and the payment will be delivered as a bank transfer to your end-recipients in as soon as one business day!
It’s that simple. Business can also pair CardUp with JustLogin, an award-winning HR suite to further leverage technology and make the payroll process that much easier.
Are there other benefits?
By setting up payroll payments with CardUp, you will receive notifications each time your credit card is charged and when the recipients receive the payment. CardUp’s UI is also user-friendly and intuitive so you can tweak it just the way you like it. Automated recurring payments? Check. Clear audit trail? Check. International transfers? Check. You can turn hundreds of invoices into payments in seconds and see all past and upcoming payments on your payments dashboard. Businesses can hold on to cash longer and optimise on-hand cash flow, and on top of that, earn card rewards! What’s not to like?
Get started with CardUp today.
This is a guest post contributed by JustLogin.
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