Payroll Debit Cards

Payroll debit cards are issued to employees of an organization. These cards function like a stored value card.The employer deposits the net salary on these cards, which can be withdrawn by the employees from any ATM. A payroll debit card comes with the brand logo of MasterCard or Visa.

Payroll debit cards are issued to employees of an organization. These cards function like a stored value card.The employer deposits the net salary on these cards, which can be withdrawn by the employees from any ATM. A payroll debit card comes with the brand logo of MasterCard or Visa.

Payroll Debit Card: Issuers

Also known as a ‘pay card,’ this debit card can be issued to employees without a bank account. Usually, a single payroll card account is opened, in the name of the employer, holding the payroll funds of all the employees. The bank holding the centralized account generally monitors the transactions of the payroll debit card, including deposits and withdrawals, as well as other paperwork.

Payroll Debit Card: Features

Features of a payroll debit card include:

• Easier access to cash across ATMs bearing the Visa or MasterCard logo.
• Acceptance in restaurants, hotels, gas stations and other merchant establishments across the world.
• Immediate termination pay and reimbursement of expenses.

Payroll Debit Cards: Benefits

Payroll debit cards offer the following benefits:

• There is no need for a checking or savings account for salary transfers.
• Easy tracking of wages and salaries, since the card balance and transfers can be monitored online.
• No discounting fees on cashing-in the salary checks.
• Reduced cost on check printing for the employer.
• Some payroll debit cards offer remittance facility that enables free transfer of funds overseas.
• Safety and freedom from carrying cash.

Payroll Debit Cards: Limitations

Payroll debit cards, however, also have some limitations, such as:

• Use of a payroll debit card for purchases and withdrawals is subject to a fee or charge, deducted from the card balance by the issuer.
• Some payroll debit cards come without a pin number, which makes them vulnerable to fraudulent use.
• Most payroll debit cards do not offer direct bill payment facility and require opening a separate checking account for the same.
• Most payroll debit cards do not offer overdraft facilities. Cards that offer this facility charge a high fee for it.

A payroll debit card system is a viable option for small businesses and businesses with temporary or seasonal employees. It can also be issued to young employees, not eligible for a direct deposit payroll scheme.