Paychex Offers Earned Wage Access in New Employee Benefits Marketplace
Human capital management software company Paychex has debuted an employee benefits marketplace.
Paychex Flex Perks, announced Wednesday (Aug. 21), offers products including early access to earned wages, financial wellness solutions, and voluntary lifestyle benefits for the employees of Paychex clients.
The marketplace is integrated directly into Paychex Flex, the company’s cloud-based software-as-a-service (SaaS) solution, letting employees self-select benefits based on their needs, giving business owners and human resources leaders more time to focus on “more strategic initiatives that come with running a business,” Paychex said.
“Based on our continuous monitoring of workplace challenges and customer needs, we see firsthand that many companies struggle to compete for talent in today’s labor market due to lack of employee benefits beyond traditional healthcare,” said Tom Hammond, Paychex vice president of strategy, partnerships, and business development.
“Paychex is well positioned to create a unique marketplace and customized experience for the employees of our clients that offers valuable voluntary benefits.”
The company’s earned wage access (EWA) offering is being rolled out as the Consumer Financial Protection Bureau (CFPB) prepares to classify such products as consumer loans.
A report released along with CFPB rule announcement showed that for employer-partnered companies the average transaction amount ranged from $35 to $200, with an overall average transaction size of $106, and the average worker accessing $3,000 in funds each year.
Meanwhile, PYMNTS Intelligence data has shown that 83% of workers age 18 to 44 believe they should have access to wages at the end of each day.
“The interest in early access comes as the majority of consumers — more than 60% — live paycheck to paycheck, per PYMNTS research,” PYMNTS wrote. “Surveys show that 56% of those with earned wage access said they had used it.”
And up to three-quarters of millennials said EWA availability would affect their acceptance of a job offer. In addition, 96% of corporates that offered EWA said their employees liked it and the offering helped them attract talent.
Meanwhile, PYMNTS spoke last month with Jill Capicchioni, product director of payments at NCR Voyix, who said that EWA has emerged in “overwhelming” fashion as a use case across the instant payment systems FedNow® Service and The Clearing House’s RTP® network.
“I don’t think that we, or anyone else, really anticipated that as a primary use case,” she said during a discussion of the first anniversary of the FedNow Service.
Despite the fact that those transactions impact consumers, “I don’t think the consumers are really aware, especially with earned wage access, that what’s driving that technology is the FedNow network.”
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