Payroll Cards, New Software and Business Pre-Paid Banking Accounts - what might you benefit from?
When it comes to financial technology, we’re all lucky to operate businesses in the UK. Britain has comfortably been the market leader in fintech for the last two decades; arguably the country has been the international finance trendsetters for centuries.
Whilst global Fintechs are slowly outpacing us, for now at least, UK recruiters are in a great position to take advantage of the world’s best modern banking facilities that can complement their current payroll and accounts to streamline their finances.
If you’ve not thought about adding payroll cards to your recruiting repertoire, swapping to an online alternative to your business bank account or overhauling your payrolling and invoicing software, you might be pleasantly surprised. Here are a few options for you to consider.
Payroll cards, like those offered by Suits Me, are a solution if your latest candidate doesn’t have a bank account.
That sounds unlikely for 2020, but you might be surprised to hear that 1.23 million people in the UK don’t have a basic current account. By a process of elimination, you’ll eventually encounter someone who is unbanked.
If you don’t have an account to pay them into, using a payroll card portal, you can simply load their details (name, address, DOB, etc.) and get an account number and sort code back within seconds. Your new employee gets a debit card posted to them three days later.
Most Payroll cards are debit cards, backed by a fully functioning online and mobile banking account that comes with its own account number and sort code. During enrolment you can open their account at the same time, generating account details in seconds so you can add them straight to the payroll.
What are the Benefits of Payroll Cards?
There are countless situations in which people find themselves unbanked. They might be migrant workers unable to use their home banking account in the UK, have a poor credit history, recently bankrupt, on an IVA or simply lack financial literacy through no fault of their own. This can be a pain for recruiters who struggle in adjusting payroll to accommodate these candidates.
In conversation with partner businesses who work with Suits Me to supply payroll cards, we’ve learnt when they met an unbanked candidate they’d usually pay wages in cash, by cheque or reject the candidate altogether to avoid the hassle when integrating them into payroll.
Paying by cash comes with obvious theft risk associated with withdrawing large amounts of money. Once you’ve paid your employee, you pass the risk onto them. Paying by cheque means forcing your unbanked employee to turn to companies such as pawnbrokers who will charge to cash it in and as such, in some cases, then brings the employees wage to below the national minimum wage. Rejecting the applicant not only contributes to financial exclusion in the UK, but also means you’ll be in danger of missing the best candidates.
Since the personal current accounts issued by Suits Me do not offer credit facilities, they don’t need to confirm your job applicant’s address or perform a credit check. This speeds up the process, meaning opening an account for your new starters adds only a short step to your enrolment.
Payroll card portals generate an account for you to pay into within seconds and a banking facility for a new employee who was rejected by traditional banks. By using them, you’re doing your part to end financial exclusion and introduce someone to safe, modern banking. The service is free for businesses too.
If you want to reassure your employees about the safety of their money, online banking accounts and payroll cards follow the rules set out in the Electronic Money Regulations 2011 which are enforced by the Financial Conduct Authority (FCA). The FCA is the regulating body for all banking activities in the UK and prioritises the safety of customer money above all else.
Business Prepaid Banking Accounts
As well as personal banking accounts like those offered by Suits Me, there are a whole host of business alternatives an SME might want to consider. Prepaid business accounts have unique selling points high street banks might neglect.
The main benefits include fast set up times, more advanced mobile banking facilities, tailored 24/7 customer service and, depending on your choice of account, assistance in payrolling, invoicing and tax calculations.
Online-only e-money accounts such as Coconut, ANNA Money and Tide or newer challenger banks like Starling Bank or Monzo have to compete with Britain’s biggest banks and, as such, have innovative features to stand out which could benefit your business heavily.
They can be the sole banking solution for any new start-ups and smaller businesses, but that does not mean they can’t be a welcome addition to supplement a well-established business’ pre-existing high street business bank account. You can use it as a back-to-basics account where any transactions are done as a way to benefit from the features your regular account doesn’t offer. When used to accompany your regular account, you can simply transfer funds as you choose.
They face the same FCA oversight and regulation as personal online-only accounts meaning you can be just as confident about the safety of your businesses’ funds.
It’s important to note, however, that online-only business banking solutions aren’t for everyone. There are monthly costs to consider which, if you’ve only opened the account for a couple of unique features, might not be worth it. The lack of credit also removes your access to a company credit card and, unlike your regular bank, you can’t walk into a local bank to meet an account manager.
Payrolling and Invoicing Software
We’re not trying to say payrolling and invoicing software are new. If you either do in-house, it’s almost certainly done using some kind of computer automation. But you might have overlooked how much the tech has changed since you last purchased any software.
In the same way that the operating system on your phone will be near unrecognisable compared to its predecessors, many systems or tech you’re relying on now might be anachronistic compared to what you can get today.
Working from home during the pandemic lockdown might have exposed how your software needs rebuilding from the ground up, showing up how hard it is to carry out basic tasks remotely. Avoid complacency - always keep software updates in the back of your mind as you can find ways to dramatically save cash and automate.
Back to online accounts for a moment; numerous online business banking accounts have invoicing and payrolling tools built into them too; you just need to spend some time shopping around to see what you’ve missed.
Peter East, Content Marketing & Outreach Executive
0844 322 1111