TD Bank offers on-demand pay solution to clients

TD Bank, the American subsidiary of Toronto Dominion, has partnered with on-demand payments provider, DailyPay, to enable clients to give employees real-time access to their salary ahead of scheduled payday.

The collaboration will allow TD clients to offer their employees access to their earned pay and deposit the funds in the employees’ direct-deposit accounts.

As a result, employees will be able to access their funds after they clock out of a shift.

The DailyPay solution connects with TD clients’ existing payroll systems to convert their employees’ working time into net earnings.

Employees will have access to their DailyPay balance anytime through their bank account or their chosen cards. They will also be able to control the frequency of the solution and portion of their pay received.

“Many employees wait two weeks, or even a month, for payday to come around,” said Paul Margarites, head of commercial digital platforms for TD Bank.

“With current pressure from inflation and other issues, this lack of access to earned wages can put workers in a bind. Unforeseen expenses, upcoming bills and day-to-day needs do not wait for payday – and now our clients’ employees don’t have to.”

TD Bank embraces technology

TD Bank’s latest collaboration continues the firm’s strategy to leverage technology to expand its services.

In April, Toronto Dominion launched a new technology delivery hub in Florida to tap into technology and innovation talent to deliver new digital products and services to its customers.

That same month, TD Bank N.A. partnered with FISPAN to embed TD commercial banking products and services into Enterprise Resource Planning and accounting software to enable commercial customers to automate cash management processes.

Early pay access continues to gain popularity

The partnership between TD Bank and DailyPay also signals the rising popularity of early pay access as the pressure from inflation builds around the world.

Reports came earlier today that French salary advance fintech start-up, Rosaly, was able to raise $10 million in new funding from a consortium of investors as it looks into expansion.

A 2021 survey by the American Payroll Association found that nearly 25% of the respondents want to access their wages on demand rather than waiting for a traditional payday schedule.

In the UK, a 2021 analysis by social impact research firm 60 Decibels, charity-backed financial wellbeing service Wagestream and other financial charities also revealed that 9 in 10 employees prefer flexible pay over alternatives, with over 15 million workers already having Earned Wage Access.

Wagesream, which offers early access to earned wages via its app, also reportedly grew its user base from around one million at the end of 2021 to more than 2.5 million in August.

As the cost of inflation bites, consumers have no option but to spend more just to meet the basic requirements, making early pay access a workable solution for some as opposed to falling into deb.

According to the Federal Reserve Bank of New York, the total US household debt reached $16.15 trillion in the second quarter of 2022.

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