Getting paid fast is more than just a benefit for gig workers. It has become a necessity in today’s challenging economic climate.
Some employers are ahead of the game when it comes to providing speedy disbursements for their gig workers, with ridesharing giant Lyft being one notable example. The company announced in 2015 that it was introducing a new payment feature called Express Pay, which allows its drivers to instantly collect their earned wages instead of waiting a week for access. The feature has been a hit with drivers since it was unveiled, and Lyft has continued to make tweaks to it since.
Other businesses seem to have missed the memo on offering instant payout methods, however. A survey released last year showed that just 7% of employers who rely on gig workers offer same-day payout options, while 61% are still processing gig workers’ payments with traditional payroll systems. This means many gig workers are struggling to secure the financial flexibility to make work-related purchases and even pay their bills.
The November edition of the Disbursements Tracker® examines why gig workers are seeking instant payment for their services and what employers can do to overhaul their disbursement practices to give gig workers access to the faster payouts they demand.
The World of Instant Gig Work Payments
Gig workers in Canada are starting to see faster access to their earned wages as prepaid cards gain traction within the nation. One study revealed that the country’s prepaid card market was projected to grow 9.3% year over year in 2021 to total 30.2 billion Canadian dollars ($24.4 billion) by the end of the year. The survey also noted that gig workers are one of the driving forces behind prepaid cards’ growing presence, with 10% of the nation’s adults working in the freelance economy and a sizable share of employers using reloadable prepaid cards to disburse funds.
Even full-time workers want to get in on the action when it comes to faster payment options. A report found that more than 66% of consumers in the United States would be interested in being compensated for work up to two days earlier than they currently are. Younger consumers are the most interested, with 82% of Generation Z consumers and 78% of millennials saying so. Banks will have to keep an eye on this trend and offer faster or even instant payroll options down the line if they hope to keep their customers from defecting to FinTechs and challenger banks that offer them.
For more stories on these and other headlines regarding gig work disbursements and instant payments, read the Tracker’s News and Trends section.
TaskRabbit on Taking an Instant Approach to Offering Gig Worker Payouts
Faster payouts are not just nice to have. Gig workers in markets worldwide now rely on instant access to their earned wages to pay bills and prepare for their next gigs.
Deep Dive: Why Giving Gig Workers Faster Payments Is a Winning Proposition for Businesses
Businesses around the globe lean on gig workers for critical tasks, but many of these freelancers are seeing their payment needs go unmet. Rather than waiting a week or more for their earned wages, they want instant access so they can stock up on work supplies and materials and keep their lights on and their mortgages paid on time.
This month’s Deep Dive examines why many companies are still stuck in manual mode regarding gig worker payouts and why they must shift to instant disbursements to keep their freelancers loyal and engaged.
About the Tracker
The Disbursements Tracker®, a PYMNTS and Ingo Money collaboration, examines the latest trends and developments shaping the fast-paced disbursements space and why instant payments are making waves across all sectors worldwide.