ADP acquires Californian digital payments specialist to target gig workers
ADP has acquired a Californian digital payments specialist in a bid to boost the appeal of its payment cards to employers of growing armies of gig workers.
The majority of Form 1099 contractors are currently paid by direct deposit into their bank accounts. But the US payroll services giant is aiming to try and shake up the market by integrating its payment card with Global Cash Card’s digital payment processing platform to create the ALINE Card.
Global’s platform enables customers to manage their digital accounts in one place by enabling them to do everything from pay bills online to enrol in rewards plans and handle their expenses.
Doug Politi, ADP’s president of added value services, told the PYMNTS.com website that it would be possible to use payment cards to address some of the unique demands of the 1099 workforce, while also enabling them to exploit many of the same benefits enjoyed by permanent staff.
“Overall, the trend is around more immediate, real-time payment capability – and that is a long-term inevitability,” he said. “That’s going to be everywhere.”
According PYMNTS.com’s Gig Economy Index, meanwhile, only about a third of US gig workers currently spend all of their time at one gig job, while 44% have a part-time job too. As a result, another appeal of the Global Cash Card acquisition is that it provides multiple accounts and purses per payroll card that be used for putting aside money for taxes or saving.
“What we’re seeing in the Millennial world today is that more people think of themselves as an independent worker and have a desire to be less tethered to an employer,” Politi said. This means that how employers pay such workers is a critical means of engaging with them, he believes.
Another advantage of the platform is that it will help gig workers manage their own finances, an area in which Millennials and the unbanked in particular are struggling, Politi pointed out.
“As the labour market is tight, the ability to keep your workers engaged and satisfied along multiple streams, whether they’re a 1099 worker or a full-time employee, you’re going to hear a lot of the same pressures to make sure they’re satisfied – and payments is one of those ways to boost employee satisfaction, for sure,” he said.