Benefits of Direct Deposit System for Small Businesses
The NACHA — The Electronic Payments Association and PayIt Green conducted a survey on which pay system is useful for small businesses. These survey results were published in June. This survey indicates mainly the small businesses need to adopt direct deposit system in employees pay.
The survey’s key points
- Less than three-quarters of employees receive their paychecks by Direct Deposit.
- Only 37 percent using Direct Deposit are from small businesses or individual employers.
- Around 63 percent midsize-to-large organizations pay by Direct Deposit.
- Companies with less than 100 employees receive paycheck by Direct Deposit which is estimated to be around 48 percent. 35 percent companies with 30 employees or less report smaller fraction.
- This system saves cost of pay of employees. According to this survey, companies can save anywhere from $2.87 to $3.15 per payment by using Direct Deposit instead of paper checks.
- It saves employee’s time. Given the statistics of time spent of 8.5 and 24 hours per year is spent going to the bank or credit union to cash or deposit their paychecks. This accounts for an estimated $3 to $5 billion loss in productivity annually.