Magazine article Workforce

Direct Deposit Reduces Costs

Magazine article Workforce

Direct Deposit Reduces Costs

Article excerpt

NEARLY 80 PERCENT OF EMployers nationwide offer direct deposit services to their employees. Half of the employers who offer direct deposit do so as an employee benefit, citing the convenience for employees. But there are significant financial advantages, too.

American employees spend up to 24 hours per year depositing their paychecks. The cost to U.S. business: between $3 billion and $5 billion annually in lost productivity. Direct deposit also offers a savings for employers of up to $1.25 per paycheck processed, according to the American Payroll Association. Use of direct deposit can reduce payroll administrative costs by up to 50 percent.

Estimates of use among the general public in the United States range from 20 percent to 40 percent. By contrast, 90 percent to 95 percent of Germany's workforce uses direct deposit, as do virtually 100 percent of Japanese employees.

The U.S. government has been using direct deposit since the 1970s. Today, more than 82 percent of federal employees and 55 percent of Social Security recipients use direct deposit. The savings to taxpayers: more than $100 million per year. And within two years, 100 percent of all payments issued by the government will be electronic. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.