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Data for today’s episode is provided by Mercator Advisory Group’s viewpoint – Payments for Work in the U.S. Gig Economy.
When a gig worker asks for early pay, how much $ do they need?
- “Early pay” is known alternatively as “pay on demand” and “daily pay”
- The fee to process this payment is either carried by the digital platform provider or the worker
- The best case scenario for employer and employee is if the platform provider funds the program and employer pays transaction fees
- However, multiple alternative schemes exist including employer funded and workers carrying fees
- Traditional financial institutions have overlooked wages earned in the gig economy
- Challenger banks have emerged focused on the gig economy for financing loans, credit cards, and merchant services
About the Viewpoint
The gig economy encompasses a growing percentage of the U.S. population and shows no sign of retreating.
From the casual “side hustle” to freelance work that represents a worker’s sole source of income, the gig economy is presenting some interesting challenges and opportunities for banking and payment providers.
