Improving Worker's Financial Wellbeing Using On-Demand Pay
In today’s fast-paced world, financial stress is a common issue among employees. Employers can play a crucial role in alleviating this stress by implementing innovative solutions like On-Demand Pay, also referred to as Earned Wage Access. This approach not only benefits employees but also enhances overall business performance. Here's how On-Demand Pay, and Level’s other financial tools, can significantly boost your employees' financial wellbeing.
What is On-Demand Pay?
On-Demand Pay allows employees to access a portion of their earned wages before their regular payday. Rather than waiting for the traditional bi-weekly or monthly pay cycle, employees can withdraw their earned income as needed. This flexibility can help manage unexpected expenses and reduce financial stress.
Read more about it here, or watch the useful demo below:
Benefits of On-Demand Pay
1. Reduced Financial Stress
Financial instability is a significant source of stress for many employees. By providing access to earned wages on demand, employers can help alleviate this burden. Employees can handle emergencies or unexpected expenses without resorting to high-interest loans or credit cards, which often lead to further financial strain. On-Demand Pay works as an alternative to expensive short-term debt such as unarranged overdrafts and payday loans. In fact, 99% of short-term debt is eliminated by the use of Level’s Earned Wage Access tool.
2. Improved Employee Productivity
Financial stress can take a toll on an employee’s mental and emotional health, leading to decreased productivity and engagement at work. On-Demand Pay solutions can help employees feel more secure and focused, improving their overall efficiency and job satisfaction.
The average Level user is able to save £100 per month through the savings tool. This money is saved in a high interest, FSCS protected savings account with no limit on how much can be saved. There are many reasons why saving can reduce financial stress and benefit workers, this BBC article talks about how it can improve sleep.
3. Increased Employee Retention
Offering On-Demand Pay can be a powerful tool for attracting and retaining talent. Employees are more likely to stay with an employer who provides financial flexibility and support. This can lead to reduced turnover rates and lower recruitment costs. Companies which use Level have seen up to a 50% reduction is staff turnover, and 62% fewer unfilled shifts.
4. Enhanced Financial Literacy
Many On-Demand Pay platforms, including Level, offer employees additional financial wellness resources, such as budgeting tools and educational content. These resources can help employees make informed decisions about their finances, leading to long-term financial stability. When using Level’s financial wellbeing app, 88% of users feel more confident with their finances.
5. Cost Savings for Employees and Employers
While most providers have a small ATM-like fee associated with withdrawing pay, the long-term savings by avoiding expensive credit products can be substantial. Similarly, in return for improved employee productivity, retention, and engagement, offering Earned Wage Access to employees can lead to a more efficient and profitable business.
Conclusion
On-Demand Pay is a forward-thinking solution that can significantly enhance your employees' financial wellbeing. By reducing financial stress, improving productivity, and increasing employee retention, this innovative approach can contribute to a healthier, happier, and more engaged workforce.
Ready to boost your team's financial wellbeing? Explore the benefits of On-Demand Pay today.