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Payroll Card Pros & Cons

Rick Yancey's Profile

payroll card pros & consI am interested if anyone has any experience funding payroll onto Wal Mart card or other type of card for those employees that do not have a bank account. 

Thanks in advance. 

 

Answers

Wray Rives
Title: CPA CGMA
Company: Rives CPA PLLC
(CPA CGMA, Rives CPA PLLC) |

I have not personally used this service for my business, but I do have clients that have used the ADP payroll cards and my wife actually has a part-time job that pays her using the ADP cards. The clients generally like the card system as it eliminates paper checks entirely. In my experience, you have to have a no paper check policy or you will have some holdouts that still like to get that paycheck. Speaking for my wife who has a regular checking account and would be happy to get direct deposit, but her company will not even offer that option, she can only get paid on the card, it is a hassle.

Another option for smaller non-ADP payroll is ING bank which has an all electronic checking account called the Electric Orange Checking. The ING account works just like a checking account, except there are no checks. All your transactions are done through a debit card or online, but it is a way to get hold out employees who don't want to deal with a bank to actually get a checking account that does not really feel like a checking account.

Topic Expert
Randy Miller
Title: Partner
Company: CFO Edge
(Partner, CFO Edge) |

A number of government agencies have moved to funding certain benefits onto cards and have seen multiple benefits from the experience (lower cost, easier distribution, etc.).
I would suggest that if you are thinking of going this route, you should not fund payroll onto a specific retailer card (Walmart, etc.) but instead use VISA, MasterCard or some other widely accepted card. These cards are usable almost everywhere, and holders can also use them at ATMs to withdraw cash. In addition, the cards are security protected so that if they are lost, they can be replaced, including any unused balances. If you are using ADP or another major payroll service, they should be able to provide you with costs and details on implementing the process.

Shay Boudreaux
Title: Program Manager
Company: ReadyFUND$ Payroll Cards
(Program Manager, ReadyFUND$ Payroll Cards) |

I work for a payroll card company.
Any payroll card for employees should work the same as direct deposit to a bank account. They should be able to provide you an account and routing number for direct deposit. I agree with the other responses, if at all possible it is advisable for an employer to chose a payroll card company rather than having the employee go buy a card and bring it in. The reloadable cards, like the Walmart card, usually have a lot of fees associated with them. Fees to load money, monthly fees and a lot of usage fees. A good payroill card company should not cost the employer anything to offer and are not usually available directly to employees.
The other posts are correct, if this is an avenue you are interested in going, depending on what state you work in depends on whether or not you can require direct deposit. You can find a list of the states on the American Payroll Association Website. www.americanpayroll.org
Also the payroll card program you choose will work with any processor or bank. You do not have to get the payroll card your bank offers because of compatibility.Feel free to shop around.

Pete DeWeese
Title: EVP & CFO
Company: Tanknology Inc.
(EVP & CFO, Tanknology Inc.) |

We moved to a debit card program for any employee that did not want to have direct deposit. While we received some kick back at first, now it has been successful. It has eliminated the need for replacement checks. If they are lost or stolen they can be easily cancelled and reissued. The biggest reason we moved to debit cards, was because in California specifically, we had a problem with employees claiming that their check was lost, we would put a stop payment on the check, 9which costs money and time), then reissue the check (again cost money and time). But the biggest problem it avoided was check cashing companies apparently do not have to absorb a risk from stop payments. We are based in Texas and we have tried to fight this many times but had to pay. So we were out the amount of the check twice. When we would check the endorsements on the lost check, there would be an unrecognizable mark. The places clearly did not care and ran the check thru. This problem was costing 10's of thousands in double payments. Since we issued the debit cards this has gone away. This cost of the cards are far less than the cost of mailing the checks and having them processed by ADP.

Armando Martin
Title: National processing
Company: National processing
(National processing, National processing) |

Lovely expose! I've come to know about the Funding payroll onto a Wal Mart card after reading out your post. This is really a well matter to know as I think. Thanks for this nice allocation and carry on....

Topic Expert
Deborah Godfrey
Title: Budget Administrator, Business Manager, ..
Company: Seeking Employment
(Budget Administrator, Business Manager, Project/Program Manager, Seeking Employment) |

Pay cards do have their advantages and disadvantages. I was a part of an organization that was actually considering use of paycards for part-time employees. Having being on the project team from the stakeholder viewpoint, there were several concerns that arose from the short lived project. The main concern was the associated fees that would be assessed to the card holder when using the card at various stores. Thus, the project went out the door. However, I recently worked on a project were I was paid on a MC paycard. I took the card directly to my bank and received the money without any fees. I say, do your homework and ask all the questions you can about a variety of products. There is nothing worst than having employees upset over paycards that eat them up with fees for using them.

Topic Expert
Christie Jahn
Title: CFO
Company: Prime Investments & Development
(CFO, Prime Investments & Development) |

We only do direct deposit. Our bank offers discounts to our employee's if they sign up for an account and will even come to their location and set it all up. It keeps it simple, but I love the ideas suggested here. My only concern would be lost or stolen cards.

Ernie Humphrey CTP
Title: CEO & COO
Company: Treasury Careers
LinkedIn Profile
(CEO & COO, Treasury Careers) |

Are there any truly global payroll card solutions yet? Back in the day I had to fund payroll in many countries and I "longed" for a global payroll card. Can any of my Treasury friends update us here?

EMERSON GALFO
Title: CFO
Company: C-Suite Services
LinkedIn Profile
(CFO, C-Suite Services) |

I heard that Amex (i believe the brand is Serve) has a really good prepaid card with considerably less fees and more features.

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