Learning how on-demand pay avoids overdraft can be the differential that your company lacked to free employees from overdraft. After all, the modality generates flexibility and autonomy so that the individuals themselves can take care of their financial planning – preventing, for example, that the bank account goes into the red because the salary advance is still far away.
In this post, we're going to talk about how on-demand pay avoids overdraft. And, if you still don't know this big trend in the HR sector, we strongly recommend this reading!
Mainly because overdraft interest rates are among the highest in the country – just as much of the country makes use of this type of loan, which is easy but costly.
And so, the on-demand salary it arrives as an equally simplified solution, with a high power of autonomy and flexibility for people to create their financial plans.
Do you want to know more about it? So, read on, and find out with us how on-demand pay avoids overdraft!
What is and what is the risk in using overdraft?
The big problem with this type of loan is simply: overdraft interest. Added to this is the ease with which this credit is granted by banking institutions.
This is usually an automatic feature, used when your account goes red. In other words: a loan made easy and without prior analysis of the applicant's profile.
As a result, banks protect themselves in the best possible way from possible defaults: with high interest rates. And, what could be a simple debit in the account, becomes an increasing debt, since you have replaced (probably) a debt with an even bigger one.
How does the overdraft fee work?
Fees vary by financial institution, but are scary. In average, can go from 20 to 500% per year!
With that, we are already paving the way to explain how the on-demand salary avoids overdraft. After all, the trend in human resources aims to relieve employees who are in debt or in the process of becoming indebted, through a practical solution that benefits everyone – the company, even!
What is on-demand pay?
Waiting, anxiously, for the salary advance can be an anguish with the days numbered, you know?
All because on-demand salary gives up the dependency that people have created with the pay days at the company. With the use of this important corporate benefit, your employees can request the desired amount – according to the days already worked – and receive it within 24 hours.
How does on-demand pay avoid overdraft?
Let's say, for example, that your employee had to make an emergency purchase on the third business day of the month – a time that people normally crave for a salary advance.
Upon checking the bank account, however, he found that the necessary acquisition would put his balance in the negative. Consequently, he would make use of overdraft.
It would, of course, be a few days consuming the rates on that loan, but what if the same situation still occurred with five, ten or 13 days to go before the next payment?
Thus, any financial planning goes to space, since these rates, day after day, drain a sado that could be better used for other things.
And so, you already understand how the on-demand salary avoids overdraft.
Upon learning of an immediate need, the employee can request the balance he has available without the overdraft being triggered. The best part is that your professional, who already knows your account routine, throughout the month, will know the best days to claim the benefit.
What are the benefits of on-demand pay?
By offering this advantage and flexibility in payment to employees, the entire company can guarantee itself in positive aspects, such as:
- reducing the financial stress of your staff, since they will have more control over their finances;
- increased productivity and engagement, since financial stress directly impacts the performance of employees;
- attraction and retention of talents due to a differential that not all companies are aware of, yet, of its importance;
- reduction in the turnover rate on account of professionals who, subsequently, are not performing as expected.
Did you understand how the on-demand salary avoids overdraft and also improves the company's results?
The solution appears as a good opportunity to generate competitive advantages. Especially, at a time when investment in technology has generated a balance in the competitiveness of the market.
How to offer such a solution in the company?
If you are interested in learning how on-demand pay avoids overdraft, but you don’t know where to start, it’s worth knowing how HR Consultant UK is taking big steps in that direction!
All because earlier this year, we launched HR Consultants UKy – our on-demand pay solution. Do you want to know more about it, before proceeding with this reading? In this text, we talk all about HR Consultants UKy!
Through it, your company has a very low maintenance to apply it in your routine. Just check which employees are interested in purchasing the salary on demand and then share it with HR Consultants UK.
Your cash flow and payment remains the same, since the entire operation is financed by HR Consultant UK itself – which charges a very low cost of up to £ 9 per transaction.
Your HR team, therefore, only takes care of the initial assessment of those who are interested in it, and all the rest of the application is maintained directly by the app provided by HR Consultants UK.
Here is a step by step for you to understand, in practice, how the salary on demand avoids overdraft with the use of HR Consultants UKy:
- your HR agrees to use HR Consultants UKy within the company;
- employees who show interest in using the salary on demand are given access to the app;
- bank details are shared so that the employee, when requesting the withdrawal, has the funds accounted for;
- the amount is charged to a working capital reserve at HR Consultants UK;
- your financier makes the payment, normally, within the stipulated deadlines;
- the amount debited from each salary is passed on to HR Consultants UK.
Did you understand? Simple, practical and without the large debts accumulated on the shoulders of your employees. A financial stress-free environment works best, no doubt!
Who is HR Consultants UK?
In an increasingly digital world, everything that involves bureaucracy is matter of the past. To bring dynamism, agility, productivity and add value to your company, know that you can count on HR Consultants UK, whose name origin is due to the “Himalayan Sherpas”, which support climbers on their travels. Therefore, since 2015, the company has brought its audience closer to technologic solutions able to qualify HR management in the market. And in the coming years, HR Consultant UK intends to help millions of UK citizens who enter the overdraft due to financial unforeseen circumstances. So, with the benefit of on-demand salary it is possible to receive the salary whenever and wherever you want. THE HR Consultants UKy this is exactly what it does, it avoids abusive overdraft interest, and contributes to the financial well-being of employees.
Come to know more about the on-demand salary, and how it can help with talent retention, in addition to reducing financial stress.