Edgars Lasmanis, Walletto Founder: The Future of Payroll and Fintech
Edgars Lasmanis, Walletto owner and founder, is well versed in the latest fintech advancements. This article will look at the explosion of on-demand pay and the benefits from both an employee and business owner’s perspective.
With society gravitating towards a more on-demand lifestyle, people seek instant gratification in every aspect of their lives. Tech-savvy consumers expect immediate access to news, entertainment and financial services all at the click of a button or the swipe of a screen. According to research shared by Business of Apps, there were 900 million new mobile payment app users worldwide in 2020, the largest annual increase to date – primarily as a direct result of the coronavirus pandemic.
In the process of embracing an on-demand economy companies are increasingly turning to fintech, revolutionising the traditional function of payroll and how businesses pay their employees. In payroll, software advances have made regulatory compliance, consolidation and standardisation easier to achieve. At the same time, technological advancements and improvements in money movement networks have make it easier for employers to cater to new employee preferences, enabling the employees of today to access earned wages via a ubiquitous mobile app.
‘Next-gen technology is slowly but surely making an entry into all business fields and industries. The payroll sector is no exception to that,’ said Edgars Lasmanis, Walletto co-founder.
Most employers run payroll either once or twice a month. However, new developments in fintech have paved the way for companies to transition to on-demand pay for their employees. Utilising cloud-based money movement solutions, employers can provide pay on demand via an app downloaded by their employees. Workers can log on at any time of the day or night, check their earnings and draw down pay as and when it suits them, providing employees with the freedom to manage ongoing financial commitments without being forced to wait for payday at the end of the month.
Also known as flexible pay or earned wage access, the service is offered by solutions that are specific to geographical regions. However, CloudPay recently launched its first global payment solution, enabling multinational companies to pay employees around the world via CloudPay NOW.
According to research from EY, 80% of workers polled agreed that they would utilise a form of on-demand pay, if offered. On-demand pay is not only sought after by low-income earners or individuals of limited financial means; rather, it is about timing and cashflow. With £72 billion in outstanding credit card debt in the UK and $756 billion in the US, credit cards are the most common form of debt. By enabling employees to access their earned wages earlier and providing financial wellbeing tools to address misaligned cashflow, users could potentially achieve significant savings on interest payments, reducing the overall cost of credit card debt.