The growing significance of the gig economy is changing how businesses handle their payments. Corporations recognize that paying freelancers for ad hoc projects is a different ball game than issuing regular payroll disbursements to hourly or salaried employees or contracting with large suppliers. Gig workers frequently want compensation that is delivered rapidly — not at the end of a two-week pay period — and more than a third of financially struggling gig workers would switch platforms to get pay advance options. Accounts payable (AP) departments must evolve to meet the needs of gig workers, who typically make a living stringing together individual projects or gigs on the side to cover living expenses.
The Next-Gen Payments Report, a PYMNTS and American Express collaboration, examines how businesses are redesigning their AP and payroll to serve gig workers’ needs and stay current with a changing economy.
Around The Next-Gen Payments Landscape
Payments technology company Payoneer announced updates to its cross-border payments solutions enabling support for small- to medium-sized businesses (SMBs) in the U.S. that wish to pay overseas contract workers. The solutions help SMBs compensate international gig workers through credit cards, digital checks and local bank transfers.
Better access to payments-related data can also be key to helping businesses modernize their payments practices. In a recent interview with PYMNTS, Mark Mathews, vice president and head of product development for employee time-tracking platform company OnTheClock, recently discussed how application program interfaces (APIs) can improve data flows between firms’ accounting departments and payroll providers, thus reducing the likelihood of payment errors. Improved data handling will also become more critical as the gig economy becomes ever more significant and companies continue to adjust their payments approaches to suit ad hoc workers’ needs.
Gig workers often not only need to receive payments quickly, but also their insurance claim disbursements. The latter is the focus of Slice Labs, an on-demand insurance provider that enables rideshare drivers and homeshare property owners to purchase hourly or per-night coverage. The company uses automation tools to accelerate claims processing. Slice Labs executives recently spoke with PYMNTS about the firm’s approach and its plans to further speed disbursements.
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How Truckers Keep On Transacting
Independent and company-hired truckers haul goods across the nation, keeping retailers supplied and in operation. Truckers have their own purchasing to do to maintain their vehicles in working order throughout their days-long trips, and transactional hurdles can derail delivery schedules. It is often too risky for drivers to carry large amounts of cash, but other payment tools can be problematic as well.
Payments providers with fraud detection strategies that fail to account for truckers’ unusual workstyles can cause frictions, as can encounters with gas stations or cargo unloaders who are unable to accept the purchasing tools that drivers have available, according to America’s Service Line-employed driver Carmen Anderson and Castle Transport owner-operator Deb LaBree. Truckers need reliable, widely-accepted payments instruments, convenient business spending and tracking tools to ensure their trips go smoothly, says Anderson, LaBree and Women In Trucking Association CEO and President Ellen Voie. In this month’s Feature Story, the three gave PYMNTS an inside look at the financial tools and strategies that make trucking more seamless.
Download the Tracker to read the Feature Story.
Deep Dive: Redesigning Corporate Payments For Gen Z And Millennial Consumers
Gig workers aren’t the only ones reshaping the economy and forcing businesses’ payments strategies to change in response. Millennials, aged 23 to 38, and Gen Z workers — those 22 and younger — are rising into more significant workforce participation and bringing new payments expectations with them. These tech-savvy generations typically prefer digital methods for their banking and payments, and many of them have never used paper checks. Employers that wish to recruit workers from these populations must therefore adjust their payroll responses accordingly, and many businesses are seeing their AP departments changed from the inside with Gen Z and millennial payments professionals updating business-to-business (B2B) transaction approaches. This month’s Deep Dive explores how workers of younger generations are reshaping payroll and B2B payments.
Read the Deep Dive in the Tracker.
About the Report
The Next-Gen Payments Report, a collaboration between PYMNTS and American Express, highlights ongoing efforts to update businesses’ legacy payments practices and deploy new innovations and solutions designed to meet the needs of the modern economy.