If you’re reading this and you’re an employee who uses Payactiv, you already know how earned wage access (EWA) has impacted your life for the better. You’ve seen how it can reduce or eliminate the need for payday loans, late fees, and overdraft fees. You’ve seen how it has reduced or eliminated your stress.
If you’re reading this and you’re an employer who offers Payactiv, you already know how earned wage access (EWA) has impacted your business. You’ve seen it in enhanced productivity, engagement, and retention. Most of all, you’ve seen it in your employee’s faces. You are seeing how you’ve helped them live the life they’ve earned.
We at Payactiv have always known that when people actually have surplus cash, they pay down debt, start to save money, and even invest. This was proven in a very unexpected way last year, when the stimulus and supplemental unemployment checks were delivered to millions of Americans.
Pawn shops around the country said consumers redeemed their pawned items at a record rate. They also made fewer loans. The same was true of payday and installment lenders. Not only were loans paid off, but consumers in every single income bracket increased their savings by an average of 200%. Investment across income brackets above $35,000 nearly doubled.
As employees use Payactiv to get access to their wages when they need them, they will create surplus cash by avoiding all the loans and fees they used to pay. That will lead to savings and investing. Excess cash flow can be spent on goods and services that enhance quality of life. Employees can adjust diets to be healthier. They can deploy that capital to enhance skill sets. They can spend more money on their families in areas that may have been lacking, such as health care, and it frees up time for workers to spend with their families without financial stress distractions.
There is no wellness without financial wellness, and we will see financial wellness dramatically improve as Payactiv is increasingly accepted as a “must-have” benefit.
Meanwhile, employers that offer Payactiv are going to see additional benefits. Some of these may be subtle, but they will become dramatic.
There are two types of employers: those that offer Payactiv and those that do not. Take a few days and notice how your employees carry themselves physically, and the looks on their faces. Then go to a competitor’s workplace and compare the two. Repeat this in July and again in December. We believe you will see a marked difference, with your employees feeling and looking better, and that’s because you offer Payactiv.
Then measure your productivity, engagement, and retention. That’s where these effects will ultimately appear. Why? If a worker feels financially secure, they are more engaged at work. If they do not feel financially secure, they will be distracted. The psychological and emotional toll of constantly chasing a paycheck, while bills pile up, are significant and ultimately affect work performance. That translates to productivity. A decline in productivity makes you less competitive in the market.
Psychological burdens become physical burdens. There is no question that mind and body are linked. The physical burden will translate into an increased reliance on health care. If the employer provides that healthcare, it means increased usage and that leads to increased premiums and reduced coverage for the workforce you need to beat the competition.
For anyone who is a football fan, Bill Belichick is a great coach because he tries to find and exploit even the smallest advantage. The advantages above are exactly how you will beat the competition. They will be spending more on healthcare, recruitment, and retention. They will be chasing the wrong tools to improve employee livelihood. You’ll already have the answer.
Payactiv wishes you all a successful and prosperous year!
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*The Payactiv Visa Prepaid Card is issued by Central Bank of Kansas City, Member FDIC, pursuant to a license from Visa U.S.A. Inc. Certain fees, terms, and conditions are associated with the approval, maintenance, and use of the Card. You should consult your Cardholder Agreement and the Fee Schedule at payactiv.com/card411. If you have questions regarding the Card or such fees, terms, and conditions, you can contact us toll-free at 877-747-5862, 24 hours a day, 7 days a week.
1 Many (but not all) employers, government benefits providers, and other originators send direct deposits early with an effective of 1-2 days later. Beginning with your second direct deposit of at least $5 from the same source, Central Bank of Kansas City (CBKC) will post the funds to your Payactiv Visa Card when we receive it, rather than on the effective date. This may result in your having access to the funds sooner. The date CBKC receives your direct deposit and the effective date are controlled by the originator.