Payroll Cards Gaining in Popularity
Banks are finding that prepaid payroll cards offer an opportunity to provide employer customers a way to save operational costs while providing employees a convenient alternative to paper checks.
AmSouth banks, for example, recently announced a partnership with WildCard Systems to begin offering a Visa payroll card. The bank said one advantage of the cards is that employers can offer them to employees without needing a credit check. Payroll is deposited onto the card, which can then be used by the holder for a broad range of purchases at 23 million Visa merchants, as well as providing cash through point-of-sale cash back and 700,000 Visa automated teller machines.
For employers, payroll cards save money by eliminating check handling costs, reducing the possibility of payroll check fraud, and reducing lost check replacement costs, AmSouth said. The company also said employer productivity is improved because employees don't need to leave work to cash or deposit checks. Employees benefit because they don't have to be present to collect their paychecks and they don't have to pay check cashing fees.
Copyright © 2004 Bankers' Hotline. Originally appeared in Bankers' Hotline, Vol. 14, No. 9, 11/04
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