Instant Payments As The Rule, Not Exception For Gig Workers

Fast work, so … instant payments?

On the heels of an announcement from FinTech firm Wirecard and gig economy startup Moonrise that the two companies had partnered to offer instant payments to workers, the question rises as surely as the moon: How has the gig economy evolved, and where is it going when it comes to payments?

Deirdre Ives, managing director for Wirecard, North America, said in an interview with PYMNTS’ Karen Webster that the gig economy has come a long way from even a decade ago, when, amid the financial crisis, people freelanced because their full-time jobs had disappeared. These days, embracing gigs is largely a matter of personal choice.

As for the phrase “gig economy” itself? Said Ives, “It’s an interesting term. It’s one that really has evolved as we’ve looked at how the economy has moved to much more of these agile … ways of earning money in supplemental income. But in reality, American workers have always picked up new jobs or supplemented their income through freelancing or taking on part-time activity.”

Remarking on the evolution, Ives said, “When we start to think about the gig economy, it’s really transcended the idea of folks driving for Uber or hosting on Airbnb or becoming a dog sitter through Rover. When you add in the internet and the connectivity that people now have traditionally to each other — as well as to companies — you start to have a cultural shift that can find workers customizing their careers, earning a little extra money on the side, gaining some independence and being able to close a gap in their monthly bills.”

She noted that 35 percent of the American workforce earns their daily bread through gig work. Looking ahead to 2027, that tally surges to almost 50 percent.

The cultural shift has been a marked one, Ives said. Just think back a decade or more. “If someone said that on your vacation, you’re going to be driven around by someone you don’t know that you’re going to contact on your phone, you’re going to stay in a house with someone you don’t know that you found on the internet, your dog is going to be babysat at your home by somebody else that you found on the internet … [and] you’re going to pay them all through your phone [through] a mobile payment … most of us would have said, “I can’t see that ever becoming part of my day-in and day-out life.’”

Against that backdrop, Ives said payments need to be as agile and as immediate as the very services that are being received. The executive pointed to Wirecard’s partnership with Moonrise, which she said offers a platform for individuals who want to pick up gig work.

Wirecard acts as the payments vehicle. The joint effort allows individuals to take on single-day work assignments or short-term projects in order, as Ives said, “to close the gap in their income earnings for that month or … to save for a vacation.”

“We place a card in their hands that [allows them to be paid] as soon as they get off work,” she continued. “This really has that immediate reinforcing act of [payment] — ‘I worked my eight-hour shift, or I picked up my five-hour shifts and now I’ve been paid immediately.’”

The card has proven to be innovative in the U.S., said Ives, where a similar solution isn’t currently in-market.

“We’ve come up with structured ways … to make sure that when money is sent out, it’s [in] real time – whether it’s Sunday night at midnight or Monday morning at nine o’clock … money [that] lands in that person’s card is immediately usable,” Ives told Webster. “So, that’s been an exciting way to think about the immediacy and to also overcome some of the challenges that you can have … [since there’s] not really … a real-time settlement right now in the U.S.”

She noted that cards can be slotted into a user’s mobile wallet, “so those individuals who are feeling a little bit more cutting-edge can also use our cards that way.”

Along with the attraction of being paid with immediacy at the end of a gig, Ives said Wirecard has looked at the statistics around the cards that have been issued.

“One of the interesting things you find is that people will choose to have wages placed on a card or placed in a separate account … because they’re saving for something special … or it’s their mad money for the week or simply how they budget. We’ve seen in the traditional pay space payroll cards being used for that consistently,” she added.