58 million Americans are independent contractors. That means 36% of the US workforce is engaged in some form or another of contract work.
With about 545 online gig work platforms worldwide, millions of workers and clients use and engage with these digital work platforms, contributing close to $1.21 trillionto the economy. With more platforms entering the market every day, this raises the question…
How are platforms attracting users and gig workers and encouraging them to stay?
This article explores how same-day ACH payments can solve some of your biggest payment challenges (and theirs), reducing churn and keeping users happy. Keep reading to learn more.
Top 4 Payment Challenges Affecting Gig Workers
While gig work offers the flexibility and independence freelancers and contractors are looking for, the payment process is leaving many of them lacking.
Whether your platform is looking to engage freelance writers like Upwork, food delivery workers like Skip The Dishes, or hosts on Airbnb. One thing remains constant. Their payment needs are complex (and so are yours).
By addressing these top four challenges, you will not only experience higher talent retention rates but also be able to attract new talent with a better brand reputation.
Unstable Income: Gig workers often struggle with unpredictable earnings due to the nature of their work, making it hard to budget and causing financial stress that affects their quality of life.
Delayed Payment Processing: Gig workers experience delays in receiving earnings, disrupting their cash flow and making it difficult to cover immediate expenses.
Inconsistency in Payment Methods: Gig workers deal with multiple payment methods like direct deposits, checks, and online platforms, which can be time-consuming and complex to manage due to fees and varying processing times.
Barriers to International Payments: Gig workers who offer services across borders may face obstacles when receiving payments from international clients. These barriers can include currency exchange rates, transfer fees, and additional paperwork, limiting their ability to expand their client base and earn a stable income.
Can Same-Day ACH Payouts Stop Customer Churn?
The gig economy experiences some of the highest churn rates – with some organizations seeing turnover as high as 500% per year. The Uberized experience has shaped the ways in which we view the world. We want fast, and we want easy. That means at the first sign of friction, we will move on. Because we can.
The reality is that with 545 platforms to choose from, if you don’t solve your gig workers' payment problems, your competitors will.
Same-day ACH payouts will have a significant impact on your platform, particularly in terms of attracting and retaining gig workers.
The ability to provide speedy payroll through faster ACH is crucial to keeping gig workers loyal to online platforms. Platforms must have a strong selling point to entice individuals to try their services, and once they onboard gig workers, the challenge becomes keeping them there.
One of the biggest differentiators amongst platforms has become faster payments.
Implementing efficient and timely payment solutions, such as same-day ACH, is a preferred option for many workers; however, only 47% of gig workers receive their wages this way.
Provide more flexible payment options and faster payouts, and all of a sudden, recruiting and retaining independent workers in high-demand fields will be that much easier.
Same-day ACH payments are pivotal in ensuring prompt payment processing and establishing a reputation for reliability and professionalism.
Benefits Of Same-Day ACH Payments
Same-day ACH payouts transform the payment landscape for gig workers and platforms alike, offering several key benefits.
Gig Workers Get
Faster Access to Funds: Workers can access their earnings faster than ever, eliminating delays and providing greater financial flexibility.
Increased Financial Stability: Same-day ACH payments contribute to gig workers' financial stability by providing a consistent income stream and enabling effective budgeting.
A Reliable Flexible Payment Method: Introducing automation into payment workflows allows ACH payments to be scheduled on a recurring basis. This ensures gig workers can count on their funds showing up in their accounts on time every time.
Software Platforms Get
Lower Transaction Fees
Same-day ACH payment transaction fees are some of the lowest you will likely encounter, especially if you rely on more expensive methods like wire transfers to make quick payments. Same-day ACH offers a more cost-effective solution, helping to keep overall transaction costs down.
Enhanced Cash Flow Management
Same-day ACH payments improve cash flow management. Knowing that payments will be processed on the same day can help plan and manage the platform's finances more effectively.
Increased Transaction Volume
Faster payment processing can encourage more transactions. Workers and clients trust the platform's ability to handle quick payments securely, so they are more likely to use it frequently.
Increased Transaction Volume
Faster payment processing encourages more transactions. When workers and clients trust the platform's ability to handle quick payments securely, they are likelier to continue using it.
Overall Operational Efficiency Savings
Same-day ACH payments streamline the payment process, reducing the administrative burden associated with handling and processing payments. This efficiency can lead to cost savings and reduced overhead for the platform.
How It Works
You can remove the “friction” around your backend reconciliation processes through a single API integration, solve your workforce inefficiencies and get the financial transparency you need.
Offer Same-Day ACH Payouts Through VoPay’s API
VoPay's advanced ACH payment solution is a significant upgrade of the current ACH payment services available through banks and credit unions.
You can remove the “friction” around your backend reconciliation processes through a single API integration, solve your workforce inefficiencies and get the financial transparency you need.
Say goodbye to complex payment processes and hello to an integrated payment solution that does it all so you don’t have to.
