The on-demand payment, or salary on demand, is an already popular modality, which aims to add flexibility so that employees receive for hours worked, but not yet paid. Something that alleviates many of the financial problems – and those generated by the challenges of closing accounts.
Having a (brief) love-hate relationship with monthly income is not something that happens only inside your home, right? Believe me: it is a daily drama for many people – inside and outside Brazil.
The CareerBuilder survey , conducted in 2017, attested that 78% of respondents are barely able to settle accounts with their salary .
In addition, of the more than 3,000 respondents, about ¾ of them also attested that they have one or more accumulated debts . Clear sign that something needs to be changed, agree?
And this transformation can come in a concept that is still little explored in the country: on-demand payment .
But don’t worry if the term didn’t sound familiar to you either, because this post will clear up your doubts and point the way to a real revolution in your company. Check out!
Why change the way employees pay?
The financial well-being has become a strong trend for HR professionals implement in companies . It’s because? It is a matter that impacts the routine.
Want an example of this? Based on the massive presence of people in debt, in the survey above, you can get an idea of the worried face that people go to work.
This interferes with their productivity, empathy, motivation and engagement . Not to mention that this accumulated stress and wear is also poured into professional activities.
In other words: more obstacles in the way of your talents , who will produce below capacity, worry more and have negative impacts on your assessments, undermining your development – both personal and professional.
What is on-demand payment or on-demand salary?
In this necessary flexibility to reduce absenteeism , low productivity and the psychological symptoms of personal problems, on-demand payment has become popular as a more attractive solution.
And what would that be? In a free translation, the term refers to a way of remunerating professionals according to the days already worked, but not yet paid.
For example: if the company has the habit of making payments for its human resources only on the 30th, or on the fifth business day of each month, professionals are limited to that.
If a pending account will earn interest in that period when there is no more money in the account, the debts will accumulate. Now, when the professional can receive payment for days already worked when he wants, he has the flexibility to plan his month .
It is also worth noting that we have already noticed something in this regard in some works more aligned with the digital and dynamic moment of the Digital Era : the transport service via applications.
In it, drivers have easy access to payment, not having to wait, exclusively, until the end of the month to receive their earnings.
How does on-demand payment work in companies?
The previous example has a lot to do with a category of services born in the cradle of the Digital Era , it is true. And this leads us to ask: and in traditional sectors of the economy?
Companies used to traditional payment models – as well as current labor laws – can be tremendous impediments to implementing on-demand payment .
It turns out that it’s not that challenging when we analyze the process. After all, if we have already managed to automate payroll , the next step is also possible.
Therefore, the basics for on-demand payment to work, here, is assertive control of employees’ working hours .
Through them it is possible to make a real-time calculation of the payment due which is already available for withdrawal.
In the United States and other countries, on-demand payment has followed a standardized application structure for conference and withdrawal requests. For example:
- the HR department sends (or the system and / or application itself automatically forwards) the employees’ hours worked;
- the system calculates the hours and turns them into a balance available for withdrawal;
- the employee has access to the value and can withdraw whatever he deems necessary;
- payment is debited from your account – the same day or the next business day.
This gives employees greater control over their expenses. This avoids interest losses and account maturities, for example, and facilitates the planning of the monthly budget .
The good news is: this has already arrived in Brazil! The Xerpay was released by Sherpa company in 2019 and already promises an innovative solution in the payment of employees. The application is simple and easy to use, allowing the employee to withdraw his accumulated salary – days already worked. Click here and understand more about this corporate benefit.
What are the benefits of salary on demand?
As we have seen, so far, the rise and global popularization of wages on demand has a lot to do with the moment we live in.
But above all, it has everything to do with corporate concern for the financial well-being of its most valuable assets: people .
First, because the on-demand salary gives the professional more control over their finances. They are no longer so dependent (or hostage) on dates – payments and wages.
With a good orientation on financial education , this modality adds more flexibility and empowerment to people.
In addition, companies that have already invested in this type of solution have identified the following changes, in the corporate routine, after the implementation of on-demand payment :
- greater control of finances;
- more motivation and engagement of professionals (even working more hours);
- fewer absences caused by personal conflicts;
- less stress generated by alarming financial situations.
Another interesting point identified: with a good deal of attention to the financial well-being of professionals , companies realized that early withdrawals were aimed exclusively at settling bills or making emergency purchases – diapers and medicines, for example.
No impulse purchases, therefore, showing how participative the company can also be in the personal development of its staff .
For companies, there remains an alignment to make the transaction more agile, secure, automated and without hindrance with financial institutions .
However, the returns generated have proven to be highly beneficial – for corporations and, of course, for employees.
When to consider using on-demand payment?
Thanks to current technology and its continuous innovations, companies can anticipate emergency situations. What’s more, they can be really concerned about their assets .
Through on-demand payment , an important step is taken in this direction. Therefore, the time for this transition may be now or in the short term.
After all, the benefits of this practice are immediate! A quick solution, therefore, and just waiting for efficient planning for your deployment.
