Money Mobility Tracker – November 2022

November 14, 2022

Fifty-five percent of consumers say their pay is falling behind in the race against inflation. Amid consumer anxiety about the rising cost of living, employees say they want more from payroll — including financial wellness benefits. A recent PwC survey found that more than three-quarters of financially stressed employees said they would be drawn to a different employer that cares more about their financial welfare.

As a result, banks are increasingly looking to add early wage access programs to their offerings. Regions Bank recently announced an early pay offering, which will enable customers to gain access to their paychecks up to two days early, in addition to other enhancements designed to boost customers’ financial well-being. Other banks making similar moves include Citizens Bank and Fifth Third.

The “Money Mobility Tracker®” examines the trend of banks and employers granting early wage access and why this is a good idea for organizations seeking to improve customer experiences and build workers’ loyalty.

Around the Money Mobility Space

With 72% of Americans living paycheck to paycheck, a growing number of employees and workers want access to their wages before payday. A survey conducted by the American Payroll Association found that 40% of Americans would find it very difficult to meet their obligations if their paychecks were delayed a week. The ability to pay employees on demand has never been more critical. More employers are turning to earned wage access to meet this demand, allowing workers to access wages as they are earned instead of receiving a lump sum each payday.

Instant disbursements not only find favor with consumers but also turn out to be an important way to boost their loyalty. Recent PYMNTS research finds that instant disbursements create a positive perception of the sender, but many recipients are not given this choice. Just 17% of those surveyed received disbursements via instant rails in the past year, led by purchase-related disbursements such as rebates, manufacturer incentives and refunds. Although this rate is the highest yet recorded, it still leaves a large portion of consumer demand for instant payments unmet.

Learn From An Insider How Faster Deposits Benefit Gig Workers

Everyone wants to have the money they are owed available to them as soon as possible. As such, products that allow quick access to direct deposits appeal to customers across the economic spectrum.

To get the Insider POV, PYMNTS spoke with Ben Mendelsohn, director of product management at Fifth Third Bank, to learn more about how gig workers and others benefit from faster deposits.

How Early Wage Access Can Equal Loyalty

The business world has transformed in the last few years as the pandemic spurred a move away from centralized teams and toward a more agile, global workforce. Now inflation is straining many workers’ budgets. The need for greater flexibility and ease in paying workers has never been greater.

In recent years, more employers and third-party payors have adopted programs that allow employees to receive their earned wages on the same day they perform the work. To build loyalty and retain talent, providing early wage access and prompt payment can mean the difference between success and failure for employers.

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Table of Contents

  • Early Wage Access: A Safeguard Against Inflation
    Wages are not keeping pace with the cost of living, but an increased number of banks and employers are offering early wage access to create a buffer against rising costs.
  • Employees Need Their Money — Now
    With more workers living paycheck to paycheck, having fast access to their hard-earned cash is crucial.
  • Why Early Access Can Equal Loyalty
    Times are tough, and the speed of payments matters. Employee expectations are also changing, and employers need to revamp their payroll departments to retain workers.
  • Faster Deposits Benefit Gig Workers
    Ben Mendelsohn, director of product management at Fifth Third Bank, gives the insider perspective on how making direct deposits available faster, regardless of the source, benefits workers of all kinds.
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