Payroll Card Basics: How a Payroll Card Works

A payroll card is simply a prepaid debit card, much like a gift card. An employer only pays an employee once they have loaded the employee's payroll card with their wages. The card is used just like a credit or debit card, without a bank account attached to it. In some cases the payroll card holder will also have access to their bank account, which allows them to withdraw funds as needed. They can also use the card to make online payments directly from their bank account.

The benefits of this type of card for both employees and employers are twofold. In the case of an employee receiving a payroll card to supplement their income from another source, like a government grant, the payroll card will eliminate the need to deposit extra money into their bank account. They will only need to deposit what they take out of their bank account. This eliminates overdraft fees that apply if the employee tries to use their bank account for an overdraft.

In addition, these payroll cards eliminate the need to hold employees' check book balances on hand, for fear that one of their employees might lose or damage them. With these cards, an employee can simply swipe their card through the reader at the time of check deposit and that amount will be deducted from their bank account on the spot. If they ever need to change their PIN number, they only have to do so once. This is a great way to prevent employees from trying to steal company property, such as computers and printers. These cards to get your paycheck earlyalso protect employers from the costly legal fees that become part of employee theft cases.

Besides theft, another problem for businesses arises when employees forget or misplace their payroll cards. It is easy to lose track of your payroll cards, and it is even easier to lose or misplace a paper check. However, paper checks are far more likely to be stolen by employees than payroll cards. Because paper checks are easy to forge, it takes a skilled thief only a few moments to load his or her purse with enough cash to cover the balance due for the day. Then it's just a matter of asking your employees to cash in their checks at your bank. While this may sound like a good idea, most of the time people cash in their checks instead of remembering to deposit them in the bank.

For this reason, many small businesses and home-based businesses have been successful using payroll cards to streamline their accounting process and provide accurate payroll reports to their owners and managers. For smaller businesses, keeping track of payroll can be a very tedious and time consuming task. This is because payroll is not just about receiving and paying payroll taxes, but making sure that employees receive their earned pay reports and other paperwork on time. Using PayActivpayroll cards eliminates this time-consuming task and allows small business owners and managers to focus on running their businesses rather than administrative tasks.

For larger businesses, using a payroll debit card instead of paper checks helps cut down on overall expenses for both employees and employers. By eliminating the need for using checks, employers can cut their annual employee payroll costs by up to forty percent. In addition, using direct deposit can eliminate paper check printing fees as well as the service charge to withdraw the money from a bank. These services are only available to employers with large accounts, but there are some employers who are allowing two employee checks to be deposited into the account instead of one. Direct deposit also provides employers with a way to ensure their employees receive their checks on time. In most cases, direct deposit is tax deductible, so employers are actually saving money by including this feature with their payroll cards. Read further at

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