If you have employees who are currently working from home, you may have to resort to mailing checks out, which takes time and poses potential security concerns. Direct deposit also helps ensure employees are paid on time, every time. In honor of Direct Deposit Month, here's a look at key benefits for businesses and their employees. Allowing human resources and payroll staff to avoid having to stay in the office to manually prepare checks. Should something popup – vacation, bad weather, emergency – and an employee is unable to receive or deposit their check in a timely manner, financial issues can arise. Once you set up your direct deposit, you will receive your Social Security benefits and other benefits on the same day every month. On paydays, an employer loads workers' cards with their wages for that pay period. Guarantee that they’ll be paid on time; Less time for paychecks to clear; No possibility of losing a check or it being stolen; Many banks offer free checking services to employees who will be paid via direct deposit; No cost to employees for using direct deposit Direct deposit provides several benefits over paper checks, including a greater level of security, faster deposits, a reduction in cost and environmental benefits. For instance, workers can split their paychecks across checking accounts, savings accounts, and retirement funds. Account and routing information for a valid bank account or payroll card; Reducing costs associated with re-issuing lost or stolen checks, stop payment charges that may be levied by a bank, and investigating when a check has gone missing. Interested in a free quote or a product demo? Good records are necessary for the preparation of tax returns, IRS audits, insurance audits, and bank financing. It eliminates the need for employees to take a trip to bank on payday. Benefits for employees. Benefits Of Direct deposits. We can help you tackle business challenges like these, Improve Employee Retention by Highlighting Your Benefits Plans, How to Prepare Your Business for the Recent Increase in COVID-19 Cases. With direct deposits, employees can access their money within a few hours after payroll release. Direct deposits are equally convenient for employers. However, some people still choose to receive paper checks and make manual deposits. Wordfence is a security plugin installed on over 3 million WordPress sites. Although the total elimination of paper may not be feasible for every business, even a small reduction can yield cost savings and increased efficiency. You can encourage employees to switch to direct deposit as a safe, secure, and easy way to access their paychecks on payday. Direct deposit can be set up for a single transaction, for repeated payments to employees, for payments to vendors and independent contractors, or for the receipt of payments from customers. If you own a small business but haven’t yet offered direct deposit, … But one risk that may deserve increased attention is class action lawsuits. If they are on vacation or on a sick day, they can be assured the deposit will be made. Electronic payment systems, like direct deposit, have resolved this and can provide immediate satisfaction to employees on pay day! Paycards help employees avoid fees at check-cashing stores. Check fraud is impossible with direct deposit. If your company is still using a paper check system, you might be making extra work for yourself and sacrificing efficiency.Over 82% of employers in the US use a direct deposit payroll system and accounts payable system, which often benefits companies, employees, and vendors alike. Discover the Benefits of Direct Deposit. 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