Payments

Mastercard powers pay advance for hourly and gig workers

  • Gig workers increasingly have to deal with erratic pay and fixed pay cycles.
  • Mastercard's Send is being used by employees to access their accrued earnings
close

Email a Friend

Mastercard powers pay advance for hourly and gig workers

Mastercard wants to provide the payment infrastructure for the growing trend of pay advance. Mastercard Send is designed to work with banks and businesses with near real time payments to almost all debit cards.

Different work requires different types of paydays: Gig workers typically piece together erratic sources of income to support themselves and their families.

  • 38.7 percent of US workers participate in the gig economy.
  • And because much of the population lives paycheck to paycheck, they've turned to pay advances.
  • More than one-third of US gig workers received approximately $236 billion in pay advances in 2018, according to research published by Mastercard.

Everyday is payday: With Evolve Bank and Trust, Mastercard is using Send to support companies which work with large organizations to provide interest-free, pay advances to their hourly workers and gig workers

  • One early client is Branch which provides financial wellness technology to hourly workers. Large employers use Branch Pay to provide their employees with early wage access.
  • Mastercard Send can push funds in near real time to nearly all U.S. debit cards.
  • Earlier in 2019, Mastercard partnered with Lyft to give drivers immediate access to their earnings. The co-branded debit card is powered by Payfare, which offers a full service mobile bank account with instant access to employee earnings.

“As hourly workers’ schedules tend to fluctuate, so do their earnings and their ability to meet day-to-day financial needs,” said Atif Siddiqi, Branch's CEO. “Branch helps increase financial stability among hourly workers by providing them instant access to earned wages, budgeting tools, and the opportunity to pick up more shifts.”

Tapping wages as they're earned: Fintech is addressing the challenges of being a gig worker with new types of payments.

  • Companies like Earnin, PayActiv, Payfare have various solutions to help employees tap their accrued earnings.
  • Some banking products and banking as a service providers have competitive offerings in this space. Companies like Green Dot and N26 offer pay advance functionality for their clients and customers.
  • Pay advance typically requires account holders to have direct deposit for their earnings.

0 comments on “Mastercard powers pay advance for hourly and gig workers”

Lending, Payments

Can lenders improve the financial health of consumers through design?

  • Design can play a critical role in improving consumers' financial health when it comes to lending.
  • Research by the Financial Health Network shows that areas like defaults, making payments, and borrowing the right amount can be significantly improved through behavioral design principles, to ensure customers make decisions that improve their financial well-being.
Rabab Ahsan | May 26, 2023
Payments

5 questions with Zip CEO Larry Diamond

  • Payment act as a beachhead for financial services firms to more deeply serve customers, according to Zip's Larry Diamond.
  • We spoke to the payment firm's CEO about his new focus on the US and the future of the company.
Zachary Miller | May 15, 2023
Payments

Microsoft brings payments for businesses on Teams

  • Microsoft has collaborated with Stripe and PayPal to enable in-app payments for small businesses on Teams.
  • Connecting or signing up for one service – Stripe or PayPal – is required to set up the Teams Payments app, with support for GoDaddy in the cards.
Sara Khairi | May 11, 2023
Payments

Tokenization, programmable payments, inclusion: Unpacking near-term trends in the payments ecosystem

  • Very little appears to be staying the same where the payments industry stands in 2023 compared to where it’s headed in the next few years.
  • Tokenization beyond cards, borderless rails, credit for the underbanked, and the proliferation of payment acceptance options are some of the near-term trends in the payments ecosystem, suggests a new Mastercard report.
Sara Khairi | May 10, 2023
Payments

As Amazon Pay now offers Citi Flex Pay, will it help Amazon close the gap with PayPal?

  • Amazon has partnered with Citi Flex Pay to offer eligible card members the ability to pay over time at merchants who accept Amazon Pay.
  • Will gaining access to Citi's card network enable Amazon Pay to gain an edge over competitors like PayPal?
Rabab Ahsan | May 05, 2023
More Articles