Some providers may charge your business a maintenance fee of $2–$5 per month. This is a one-time cost that covers the production and delivery of the card to the employee. Some providers charge a nominal fee for issuing a payroll card, typically ranging from $3 to $5 per card. While your employees won’t have to pay any fees, you might need to. This can be an enticing perk for employees but may limit where they can use the card.įederal law requires employees to get access to their net pay without add-on costs. Brand-Specific Pay Cards: Some cards are tied to specific brands or retailers, offering rewards or discounts when used at these locations.While this eliminates recurring fees, the need for a new card each payday could be inconvenient. After the funds are used, the card cannot be reloaded. Non-reloadable Pay Cards: These are single-use cards loaded with an employee’s pay for one pay period.However, they often come with various fees such as loading and transaction fees, so be sure to review the fee schedule meticulously. They function like a debit card, allowing employees to withdraw cash or make purchases directly. Reloadable Pay Cards: Used widely across industries, these cards are loaded with the employees’ wages each payday.If you’re considering pay cards, you have several options: Some of these providers offer additional services to your business beyond merely providing pay cards. Additionally, you may be able to set up pay cards with your existing payroll service provider, bank, credit card company, or even a professional employer organization (PEO). In addition to pay card providers, some payroll software can set up direct electronic payments to third-party pay card providers in the same way you would set up direct deposit. Cards are mailed after setup is complete.įor more information about payroll card providers and what they offer, check out our payroll card buyers guide, which also contains a list of our top-recommended solutions. Setup can last from a few days to a few weeks, and you should receive training materials to help explain the process to employees who opt to participate. Typically, there’s an enrollment process, and you’ll have to sign up before you can begin. To implement a pay card program, you’ll have to find a provider. Per federal law, employees should be able to access their funds immediately and free of charge. Once the money transfers, funds are available immediately, and the employee can use the card to withdraw money from an ATM or make online or in-store purchases. Payroll cards work similarly to direct deposits, except employee pay is transferred to a prepaid debit card instead of directly to an employee’s bank account. Some providers will offer pay cards free to customers, while others charge fees for setup, ATM withdrawals, and even inactivity. So, if you’re already utilizing payroll software to run your payroll, it’s a good idea to check whether they offer pay cards. If you’re wondering what a pay card is good for, the answer is that it’s great for providing employees with easy access to earned wages. Pay cards are available from dedicated providers, banks, or payroll companies. Although regulated by federal and state law, they’re similar to direct deposits in that money is sent electronically, and setup is sometimes free. A pay card (also known as a payroll card) is a prepaid debit card employers use to pay employees who don’t have bank accounts.
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