The gig economy has turned many heads and grabbed attention from small and medium businesses. Hiring freelancers helps companies to become more agile and remain competitive.
Paying freelancers – now that’s a different matter. Managing payments is already a complicated process for employers and HR. Add in freelancers and contractors in addition to your traditional employees and the process becomes even more intricate. Payment processing is already an involved process for employers and HR. However, things can get more stressful once you throw freelancers in the mix.
Thankfully, you can eliminate some of the demanding administrative functions of managing freelancers with these convenient payment alternatives.
Direct deposit
Direct deposit is a solution that has liberated many businesses from the hassle of handling paper checks. It allows employers to deposit funds electronically into a worker’s bank account.
Pros
- It saves money – Companies don’t have to spend money on paper supplies and manpower to issue paper checks.
- It saves time – Writing, printing, and sending paper checks wastes valuable time. On the other hand, direct deposit saves time and is faster.
- Freelancers can receive money remotely – Remote working is on the rise. With direct deposit, businesses can process pay remotely, and workers still get paid without being forced to show up and collect their paper check.
Cons
- Requires freelancers to have a bank account – Direct deposit puts unbanked freelancers at a disadvantage. Even banked freelancers may prefer a more convenient payment method like payout cards.
- It often takes time before gig workers get their money – Direct deposit may be convenient, but it’s not always instant. Employers have to submit early to ensure workers receive their money when they’re supposed to have it – usually at least 2 or 3 business days lag time. Therefore, it may not be the best solution for employers who want to implement early or flexible payment.
- It potentially comes with fees – Direct deposit can come with fees from the intermediary that is transferring funds. Tthe cost of using direct deposit can get inflated in the long run.
Paypal or Venmo
PayPal and Venmo both offer a convenient way to pay freelancers and contractors.
Pros
- The money appears instantly – You can send funds electronically, and the other person will receive the funds immediately. Employers can send money quickly and easily through Paypal or Venmo.
- Convenient for paying freelancer – Most freelancers have a Paypal or Venmo account. These payment methods enable you to scale up your gig workforce without making paying freelancers a headache.
- Widely accepted (relatively) – Although Venmo is only available in the US, PayPal is available in many countries and is a viable way to pay remote workers. In addition, both payment methods allow gig workers to shop in many places online.
Cons
- High fees and charges – Fees for business owners tend to be higher than for individuals. Usually, the fees and charges don’t seem like much, but they can work out a substantial sum that eats into profits.
- It takes time to transfer to a bank – While receiving money via PayPal is instant, transferring the funds to a bank account takes time. Sometimes freelancers may not have bank accounts connected to their Paypal or Venmo accounts.
- Comes with other limitations – Generally, Paypal and Venmo don’t have enough bandwidth or features to meet the pay needs of most companies, even small businesses.
On-demand access to payment
On-demand pay is the perfect option for the modern-day worker accustomed to a fast-paced world. It enables freelancers to receive their pay at any point in the pay cycle. On-demand access to payment even allows freelancers to take home their earnings at the end of each shift.
Early payment for work done might seem like the opposite definition of stress-free, but it can be a lifesaver if employers engage the right service. For example, Juice Banking enables employers to offer on-demand pay without turning their payment schedule upside down.
When done right, on-demand access to payment can reduce stress levels in several ways:
- It allows businesses to quickly and easily incorporate this “must-have” benefit for freelancers.
- Businesses don’t have to deal with requests for advances.
- Businesses can conveniently increase their flexibility and move away from the traditional pay cycle.
- It’s easier to create financial equity and wellness for freelancers without breaking the bank.
Early and flexible payment also offers impressive value for employers looking to increase employee satisfaction and retention for your non-freelancers.
Payout cards
By using Payout cards such as Juice Payout cards, you can easily pay freelancers whether they’re on the road or in a different part of the world. Payout cards are versatile and can be used for various purposes, including:
- Same-day pay
- Instant pay
- Employee expense payments
- On-demand access to payment
Setting up is easy and reloading the cards is even easier. Here are more reasons why payout cards have revolutionized payment and made life easy for HR.
- They are reloadable, so there’s no need for new cards for each pay period.
- You can load payment any time and from any place.
- They are suitable for banked and unbanked freelancers alike.
- Payout cards can eliminate stressful and costly payment methods like paper checks.
- Juice Payout cards are an easy way to streamline pay for freelancers.
Which Payment Method Is Worth Your While?
As you can see, there’s no shortage of ways to pay your freelancers. However, if you want to keep freelancers happy and engaged, payout cards represent the ultimate stress-free way to pay freelancers.
If you’re looking to increase your arsenal of tools for attracting high performers in this unique talent pool, learn more about other stress-free ways to boost employee retention and satisfaction.
