Wirecard Partners with Gig Economy Upstart, Enabling Same-Day Pay

Payday Loan Place Window Graphics courtesy Taber Andrew Bain.

Recently, we’ve seen the number of companies and products providing consumers access to credit at the click of a button grow. But companies enabling employees access to their paychecks ahead of payday aregrowing in number, too—no interest rate required.

Moonrise, a startup that connects individuals with shift work in administration, hospitality, and other services, is now partnering with Wirecard to enable same-day payment of its temp workers. Incubated within and wholly owned by American Family Insurance, as reported by Xconomy, the gig-economy startup is launching a pilot of its temp service in Chicago this month.

Moonrise’s move to incorporate a Wirecard payment card reflects both the immediate access to capital necessary for people participating in the unpredictable gig economy as well as the accelerating trend of companies recognizing and addressing this need.

According to Lyft’s Vice President Ashwin Raj, if you think employees of the gig economy can wait days to be paid, “you don’t understand the economy we’re working in.”

Raj said morning drivers for Lyft need funds available to buy gas for their afternoon rides. This is where Express Pay comes in.

Express Pay is Lyft’s implementation of Stripe’s Instant Payouts, which the ride hailing company implemented two years ago. Instant Payouts allows any business to pay its workers instantly: After workers “finish a shift, they can immediately deposit their pay in the bank and start using it—rather than wait the two or three days payouts typically take.

Through a company and same-name app called Even, Wal-Mart is the most recent major company to introduce an option for employees to take home their pay, or at least a portion of it, ahead of payday.

“Right now, everyone is paid every two weeks,” Kashif Siddiqui, head of payments Cross River Bank, said at a payments event hosted by Tearsheet last fall. “That doesn’t really work for shift work, for the gig economy.”

As a temp agency, Moonrise’ differentiation is its decision to only hire workers who already have full-time commitments, citing a “higher reliability and credibility,” as  compared to the average temp worker. Its temp workers are paid between $11 and $16 an hour.

It’s interesting, then, that an agency likely serving as a second source of income for most is also jumping on board to pay out its employees faster.

While this quicker access to capital should help lower-income Americans and those participating in the gig economy avoid trips to predatory payday shops with high interest loans that can entrench them in additional debt, the demand speaks both to low pay combined with insufficient access to capital and credit. The latter, at least, technologies and the firms behind them finally seem to be solving.

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Cadence is a fintech reporter and writer at Fintech Unltd, where she covers the changing landscape of financial technologies. Previously, Cadence interned at Psychology Today, Business Insider and the Wisconsin State Journal. Cadence is interested in how science and technology intersect with power and culture and is curious about the world we are creating for tomorrow, consciously or not. She graduated from the University of Wisconsin–Madison in 2017 with degrees in Journalism and Chinese. Send tips and story ideas to Cadence at [email protected] You can also follow her on Twitter @cadencebambenek.