BROOKFIELD, Wis.–Fiserv said a new partnership withPayActiv will enhance employee financial wellness by allowing access to earned wages ahead of a payday.
“PayActiv’s mission is to bring security, dignity and savings to American workers,” the company said. “It allows businesses to provide employees with a holistic financial wellness solution that includes real-time access to up to one half of their earned wages prior to receiving their paycheck, helping workers alleviate financial stress by avoiding payday loans, overdraft charges and late fees. The company processed more than $1 billion in earned wage access for workers nationwide during 2018.
Fiserv noted the Expectations & Experiences consumer trends survey conducted by Harris Poll on behalf of the company found 30% of consumers consider managing money to be a burden and that 38% of consumers – and half of Millennials – say it would be difficult or impossible to pay back a $500 loan today.
Living Paycheck to Paycheck
“Many people live paycheck to paycheck, and any sort of urgent or unexpected financial need can cause them significant stress that detracts from their daily lives,” said Safwan Shah, CEO of PayActiv. “PayActiv can eliminate that stress by giving people a convenient way to access the money they have already earned.”
The company added, “Timely access to pay addresses the needs of any worker, including gig and hourly workers, who can benefit significantly from the ability to move money when and where it is needed, even at 3 a.m.”
“With the rise of the gig economy and new ways of working, people increasingly expect to be able to access their pay right away,” said Tom Allanson, president, Electronic Payments, Fiserv. “PayActiv is enabling employers to meet that expectation.”
Real-Time Money Movement
The company said PayActiv utilizes Digital Disbursements from Fiservto enable users to move money in real time to a U.S. checking or savings account via a direct push to their card account.
“While users have always been able to send money to bank accounts, the process could take a few days. Now, with a connection to Visa Direct via Digital Disbursements, users can move money to their bank accounts in near real time, usually in minutes,” Fiserv said.
PayActiv users can transfer funds directly to a bank account or prepaid card, pay unlimited online bills, or pick up cash at a Walmart location. The PayActiv app also includes access to financial counseling, literacy, and a savings tool that encourages long-term financial wellness, Fiserv said.
According to Fiserv, earned wage access can set an employer apart in competitive employment environments, and business owners benefit from more empowered and productive workers, as well as increased retention.
From 5 Employees to 2 Million
“We can serve a business with five employees or two-million employees,” said Shah. “The majority of Americans are employed by small businesses, so it’s important for us to be able to reach the entire market.”
PayActiv was confident in choosing Fiserv because they knew Fiserv could handle their current volume and scale as PayActiv grows.
PayActiv is offered by employers as a benefit to employees. Nearly 500 businesses in a range of industries including healthcare, retail, and hospitality, offer PayActiv. While the service is available to all employees, use of the service is voluntary, with 30% to 40% of an employers’ eligible users typically using the service, Fiserv said.