Square announced the launch of two new features, On-Demand Pay for employees, and Instant Payments for employers. These new features will enable Square Payroll customers and their employees to more easily and effectively manage their cash flow.
The new offerings, which leverage Square’s Seller and Cash App ecosystems, represent a major milestone in providing employees and employers more flexibility and control over their money.
On-Demand Pay is available in 48 states and employers can offer the feature to their employees at no additional cost. Instant Payments is available to all Square Payroll customers that have a Square Balance at no additional cost.
“The traditional payroll process is slow and rigid, creating cash flow constraints for employees and businesses alike. This is even more pronounced now given the current economic conditions,” said Caroline Hollis, GM of Square Payroll.
“Because businesses still run payroll on a fixed schedule, employees are paid days or weeks after they’ve worked. We created On-Demand Pay for employees so they can access their earnings when they need them, as soon as their shift has ended. For employers, it can take up to four days for payroll funds to move from their bank account to their team. With Instant Payments, employers can now fund their payroll instantly, getting money to their team faster
On-Demand Pay
Employees using On-Demand Pay can transfer up to $200 of their earned wages whenever they need them, for free to Cash App, Square’s mobile payment service that allows individuals to spend, send, store, and invest money. Some employees will also have the option to transfer their on-demand pay to a linked debit card for a 1% fee per transfer, not to exceed $2.
Instant Payments
Instant Payments allows Square Payroll customers to fund their payroll using the money in their Square Balance, where sales they process via Square are stored. By expanding the functionality of an employer’s Square Balance and enabling Sellers to select it as a payment source, Square receives confirmation of payroll funds instantly and can initiate payouts to employees immediately. Team members and contractors who have elected to be paid via Cash App receive their pay within minutes, while those paid via direct deposit get their pay as soon as the next business day.
