It’s not easy working in the gig economy. The lag time in getting paid is just one of the disadvantages. But last year Uber stepped up and initiated a faster process with GoBank and the global debit card networks. According to the following article, the pay program has met with widespread driver approval.
Uber introduced Instant Pay last year, as a way to use the revenue from their Uber fares right away, without waiting for it to be deposited into their own bank account. The company first launched the program with GoBank and a dedicated Visa card, but eventually opened it up to virtually all U.S-based MasterCard, Visa or Discover debit card tied to checking and savings accounts. Opening things up led to a big spike in usage, which is how the service managed to account for over $1.3 billion dollars in cash-outs by drivers in its first year alone.
Uber says that “hundreds of thousands” of U.S.-based drivers have now signed up for the program, after an initial group of around 80,000 signed up prior to the expansion to more debit cards in Instant Pay’s first few months of operation. The biggest day for payouts on the program was December 18, 2016, Uber notes, which suggests that the broadened access has helped interest ramp significantly among drivers.
The program is expanding again today, with new eligibility requirements that essentially open it up to all drivers and UberEATS and delivery couriers with at least one trip on file, though it’s still limited to users in the U.S.
Uber also admits it still has a long way to go in terms of improving the experience for drivers. I spoke to a former Uber business partner who said the churn rate for drivers is considerably high. But the company does seem serious about turning things around, with updates including improved in-app navigation, and more support options on the driver’s side.
Driver growth and retention is key to Uber’s success long-term, so it’ll have to keep the pedal down on this ongoing list of improvements to help sustain its product trajectory.
Payroll card programs have become popular among employers that hire contract workers as well as for employee groups that are underbanked. With debit card payment acceptance and ATM access, card users find both speed and convenience. In the case of Uber, it’s a benefit that they can tout to drivers in what has become a competitive and high-turnover ride-sharing industry.
Overview by Raymond Pucci, Associate Director, Research Services at Mercator Advisory Group
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