The payroll card is a secure and convenient method for small businesses to pay employees. This option is especially useful for businesses with limited access to traditional banking services. Payroll cards are prepaid cards that can be used for payroll purposes. They work just like other credit or debit cards, with the user simply entering their personal information and choosing how much money to load onto the card.
Businesses that use payroll cards charge fees of between 2-3% of each payment made to the employee’s account. Furthermore, some providers might charge additional fees on top of this percentage, Omgflix.com.
Fintwist offers a payroll card option for small businesses to pay employees without bank accounts, but employees might pay fees instead of receiving them as compensation.
What is Fintwistsolutions
Fintwistsolutions is a company that helps small businesses set up and manage payroll cards. Fintwist Solutions partners with financial institutions that offer payroll cards, including credit unions, banks, and other financial institutions.
When a business wants to start using payroll cards, it must first sign up with a payroll card provider. Each provider has its own rules and regulations when it comes to setting up a payroll card. Fintwist Solutions partners with more than 20,000 financial institutions to make payroll card management easy.
Payroll card providers charge a set fee. Usually, the fee is between 2% and 3% of the amount loaded onto the card. However, most providers charge additional fees as well. These fees come in the form of convenience fees, late payment charges, and over-the-limit fees. Most employers avoid convenience fees by paying their employees’ payroll cards with a direct deposit.
But, some employers might pay the convenience fee because it’s easier than loading a direct deposit. For example, some employers might skip the hassle of setting up a direct deposit and simply pay their employees’ payroll cards with a credit card. The late payment fee varies from provider to provider. Some providers charge a flat fee of $25 per payment, while other providers charge a percentage of late payments.
Pros and Cons of Payroll Cards
- Allows employees to have a traditional bank account, so they have access to loans, the bankruptcy system, and credit history. It is less risky for small business owners because the money is controlled by an outside entity.
- Employees can manage their funds, and if they don’t receive a paycheck, they will not be able to spend the money they have saved. Employers don’t need to set up a payroll account or spend money on expensive auditing and bookkeeping services.
- The money is deposited into the employee’s bank account the next business day. – Employees can use the card for purchases, such as groceries, gas, and clothes. Employees can transfer money between their savings and checking accounts or use their cards to make online purchases. Employees can also use the card to withdraw cash from an ATM.
- When employers pay employees with a payroll card, they risk losing an unexpected paycheck.
- Employees might lose track of the card and make unauthorized purchases. if an employee misuses his or her funds, the employer will be responsible for those purchases. If an employee steals the card and uses the money, the employee will be held responsible.
- The payroll card’s terms and conditions must be clearly outlined by the company and employees must read and fully understand these terms.
Fintwist’s Payroll Card Service
Fintwist’s payroll card service is fairly simple. Employees sign up online with a bank account and a payroll card number. After completing the online signup, employees receive their card number and a unique PIN number.
With this information, employees can start making payroll card payments. Employees can pay themselves for work completed, receive regular pay for work completed, make partial payments for work completed, make payments to an individual who is not an employee, or make payments to an employee who is not an employee. Employees can use their Fintwist card to make purchases, withdraw cash from an ATM, and transfer money between their savings and checking accounts.
How to Set Up a Payroll Card with Fintwist
Even though Fintwist’s payroll card service is relatively simple, there are some important steps to remember.
- First, employees must sign up for payroll cards with a bank account. Fintwist partners with more than 20,000 financial institutions to make this process as easy as possible.
- Second, employees must set up their direct deposit with the employer.
- Third, employees must write a check to their bank account. This will create a deposit record in the bank’s system. This record will make it easy for employees to access their funds.
- Fourth, employees must load money onto their cards and make deposits.
- Fifth, employees must keep their cards’ PIN numbers safe.
- Sixth, employees should make sure to use their cards as often as possible.
The payroll card is a useful financial tool for small businesses that don’t have traditional bank accounts. Fintwist’s payroll card service is fairly simple, but employees must set up a bank account with a bank that partners with Fintwist. Once that’s done, employees can easily set up and use their payroll cards.