Once there was a single way to pay, now there are many ways to pay.
Visa, Klarna, Paypal, Clearpay, Mastercard, Apple Pay, Google Pay.
Credit card, debit card, bank transfer, pay in 3, pay in 30 days.
Online checkouts now offer a plethora of different options and brands.
You can pay with the same method every single time. You may choose a different method each time. The point is that you now have the choice.
As consumers, we’ve become used to choice. Buy Now Pay Later (BNPL) may have started as a payment option on low-price, ‘fast fashion’ websites, but it’s now a feature of most online checkouts.
It’s impacted my own choices too.
I never desired nor expected to split payments for online purchases. Now, for high-value purchases, I often use the service.
My reasons for doing so are purely psychological and emotional rather than economically rational.
These days, I expect to be able to use contactless payment in stores and tend to avoid places that only accept cash. I now expect to see Buy Now Pay Later as an option at the checkout.
If it’s not available, I may choose to purchase elsewhere.
Innovation tends to be consumer led, which is why the consumer checkout has diversified the fastest. But business software is beginning to catch up.
Choice at checkout (and on payday)
Employees have been left behind while consumers have been prioritised.
There has always been one standard way of getting paid: when your employer chooses to pay your salary. Sometimes weekly, but often monthly. Now, thanks to developments in fintech and payments, you can get paid whenever you choose.
At Level, we often refer to monthly salary as ‘an accident of history’ but it is actually no such thing. It has been carefully designed to suit the operational needs of employers and their payroll team.
It serves the interests of cost-saving and efficiency. It definitely didn’t evolve to serve the interests of the working population who consistently indicate they would rather be paid more frequently when asked.
On-Demand Pay technology means workers can now choose when they get paid. They may be happy to continue being paid at the end of the month. But they may prefer to get paid weekly, daily or every other week. Their preference will likely vary according to time and circumstance.
The point is that they now have the choice, whereas previously they had none.
We often get told by employers that their workers don’t need On-Demand Pay. This is almost always correct. Very few people need to get paid more often as most bills and regular outgoings occur monthly at fixed intervals.
But, by the same token, most people don’t ‘need’ a dozen different places to buy their coffee or their groceries. Nor do they need different ways to pay for them.
Innovation is about expanding choice, not about replacing one thing with another. What innovation brings, particularly technological innovations such as On-Demand Pay, is more choice.
Choice is empowering, non-limiting, and generally good for society. Innovation and therefore the amount of choices people have has increased exponentially.
A lack of choice is now louder than the provision of it. As the business world becomes increasingly employee led, they will choose their employer based on a myriad of factors, one being the employer’s provision of choice (or lack thereof).
In the same way that consumers are choosing their provider based on the choices they offer, this is now also the direction of On-Demand Pay.
It’s at this pivotal moment that employers will soon be divided into innovative, forward-thinkers and those that caught on a little too late.