This collaboration aims to provide real-time access to wages as they are earned, giving employees the ability to access their funds immediately through their direct-deposit accounts, the companies said in a Thursday (Sept. 21) press release.
Andrew Harrison, head of U.S. digital partners at BMO, said in the release that this partnership is about empowering clients to provide innovative and convenient payment solutions for their employees. The partnership comes as businesses increasingly seek flexible digital payment solutions that align with the changing economy and evolving payment preferences of employees.
DailyPay integrates into employers’ existing payroll systems, enabling employees to access their earned but unpaid income on their own schedule, according to the release. With earned wage access, employees experience reduced financial stress and improved financial management, leading to longer tenures with their current employers.
For BMO’s commercial clients, offering DailyPay’s earned wage access solution can provide a competitive advantage in the current tight labor market, the release said.
Kevin Coop, CEO of DailyPay, said in the release that the collaboration will enable more businesses and employees to benefit from DailyPay’s on-demand pay solution, ultimately leading to better financial outcomes for all.
BMO Financial Group, with total assets of $1.25 trillion as of July 31, is the eighth largest bank in North America, according to the press release. The bank serves over 13 million customers across Canada, the United States and select global markets.
PYMNTS Intelligence has found that workers increasingly prefer to receive their wages as they earn them. Companies that implement earned wage access can therefore improve employee loyalty, according to “The Rise of Instant Payroll and Early-Access Compensation,” a PYMNTS and Ingo Money collaboration.
Earned wage access can help employees avoid the expense of using payday lenders or bank overdrafts to pay off unexpected expenses, Rob Nardelli, director of commercial banking and business development at DailyPay, told PYMNTS in an interview posted in June.
“For 95% of Americans, the only options they have today would be to turn to those alternatives,” Nardelli said. “[Earned wage access] represents a way for them not to have to take on debt. They’ve earned the hours and wages. EWA just gives them access.”