More Businesses Are Powering Their Employees with Innovative Payroll Solutions from rapid!
Green Dot's (NYSE: GDOT) subsidiary, rapid!, has expanded its portfolio to over 7,000 employer customers, adding nearly 1,300 new businesses in 2023.
New partnerships with Elevanta, TempWorks, and isolved will serve an estimated four million additional employees.
rapid! provides innovative payroll solutions, including earned wage access (EWA), which is shown to enhance recruitment, retention, and financial wellness.
Surveys indicate that EWA is highly valued by employees, aiding them in timely bill payments and savings, and leading to significant HR benefits for employers.
- rapid! added nearly 1,300 new employer customers in 2023.
- New partnerships with Elevanta, TempWorks, and isolved.
- rapid! now serves over 7,000 employers and four million employees.
- Earned wage access (EWA) is highly valued by 83% of employees, comparable to retirement benefits.
- 90% of employees value quick access to emergency funds.
- 84% of employees using EWA can pay most bills on time.
- Employers report a 15% reduction in time-to-hire with EWA.
- Employers see a 21% reduction in 90-day turnover with EWA.
- No specific financial figures or revenue growth metrics are provided.
- Potential operational risks with the rapid integration of new customers and partners.
- Overreliance on partnerships could be risky if relationships deteriorate.
Insights
The recent announcement from rapid! regarding the expansion of its payroll solutions to new companies in the staffing, human capital management (HCM) and professional services sectors is notable. First, it’s essential to recognize that payroll solutions are a recurring revenue model. This means that as rapid! adds more clients, its revenue stream becomes more predictable and stable. Additionally, the partnerships with Elevanta, TempWorks and isolved, each serving substantial employee bases, imply a significant expansion in market reach and client base.
However, the financial impact might not be immediate. While the addition of nearly 1,300 new businesses in 2023 is promising, investors should be aware that onboarding such clients and seeing a material revenue impact can take time. Short-term investors might not see an immediate spike in stock price, but long-term investors could benefit from the steady growth in a highly fragmented market.
Furthermore, the earned wage access (EWA) feature mentioned is a growing trend in payroll solutions, which can enhance employee satisfaction and retention. This could potentially reduce costs related to hiring and training new staff for employers using rapid!’s services, thus making the solution more attractive in the long-term.
One point to watch for would be the integration success and customer satisfaction with these new partnerships. Continuous growth in this sector often depends on the smooth functioning of technology and customer service, so any glitches or dissatisfaction could harm rapid!'s reputation and growth trajectory.
From a market perspective, the expansion of rapid! into various industries such as staffing and HCM through partnerships with companies like Elevanta, TempWorks and isolved, indicates a strategic move to diversify its client base. This diversification can protect rapid! from industry-specific downturns and demonstrates the adaptability of its payroll solutions.
Moreover, the emphasis on earned wage access (EWA) is a critical competitive differentiator. EWA is becoming increasingly popular as employees seek more flexible financial solutions. According to survey data, 90% of employees value quick access to money in emergencies, which underscores the demand for such features. This demand can drive rapid!’s adoption rates and customer loyalty, especially among younger and more financially savvy employees.
For retail investors, it's also essential to note the broader market trends around financial technology (fintech). The fintech sector is growing rapidly and companies that offer innovative solutions like EWA are often viewed favorably by the market. However, the competition is fierce. Investors should monitor how rapid! differentiates itself from competitors and how it maintains its partnerships to ensure sustained growth.
In conclusion, rapid!’s expansion and focus on fintech innovations align with current market demands, positioning the company well for future growth.
New companies join rapid!’s growing list of employer customers enabling their workforces with more seamless and convenient payroll solutions
“Today’s employers are turning to financial technology leaders to help improve the way employees get paid and manage and access their earned wages,” said Alex Bartels, GM of rapid! and SVP, Wage and Disbursement at Green Dot. “Providing employers more accessible payment solutions for the benefit of their employees is core to our mission to give all people the power to bank seamlessly, affordably and with confidence, and we’re proud to continue growing our relationships with these partners.”
Supporting more than 7,000 employers, including nearly 1,300 new businesses added in 2023, rapid! has expanded its relationships with channel partners including:
- Elevanta, an employer services company offering business owners and franchisees a full suite of services that includes everything from payroll and accounting services to insurance programs, administrative support and more. Elevanta counts more than 46,000 employers (franchisees owning more than 121,000 businesses collectively) and over 2.6 million employees among its customers.
- TempWorks, which serves more than 500 temporary staffing agencies of all sizes across the nation through its staffing software solutions, which feature everything from online application portals to mobile front office and onboarding tools to employee engagement mobile apps and more.
- isolved, an HCM technology leader providing software and services to nearly seven million employees and over 168,000 employers across all 50 states, increasing productivity, accelerating decision-making and ensuring performance, while reducing risk.
rapid! is the wage and disbursements arm of Green Dot and supports employers in a wide variety of industries by offering wage payment solutions that give employees easier access to their earned wages. rapid! offers a single disbursements platform for all an employer’s payout needs, backed by powerful management tools, risk controls and robust money processing systems that allow employers to remain compliant with all relevant labor laws and regulations.
rapid!’s innovative payment solutions can help businesses improve recruitment and retention while boosting the financial wellness and productivity of employees. One such innovation is earned wage access (EWA), which has had positive impacts for both employers and their employees according to recent survey data:1
- Employee respondents say EWA is nearly as important to them as retirement/401(k) (83 percent) and life insurance (79 percent).
- Ninety percent of employee respondents say having access to money quickly in an emergency is very important to them.
- Respondents say EWA helps them pay most of their bills on time (84 percent), pay off some credit card debt (67 percent), and put money into savings monthly (57 percent).
-
Employers report a 15 percent reduction in time-to-hire and a 21 percent reduction in 90-day turnover following the implementation of
EWA benefits.
"Employers are rightfully concerned with providing financial wellness offerings that make the most impact for their employees," said Pragya Gupta, Chief Product Officer at isolved. "We're proud to partner with rapid! to provide solutions that create real-world impact for employees to access their pay when they need it."
For more information on rapid!’s innovative wage payment solutions, including its
About Green Dot
Green Dot Corporation (NYSE: GDOT) is a financial technology and bank holding company committed to giving all people the power to bank seamlessly, affordably and with confidence. Green Dot's technology platform enables it to build products and features that address the most pressing financial challenges of consumers and businesses, transforming the way they manage and move money and making financial empowerment more accessible for all.
Green Dot offers a broad set of financial services to consumers and businesses including debit, checking, credit, prepaid and payroll cards, as well as robust money processing services, tax refunds, cash deposits and disbursements. Its digital bank GO2bank offers consumers simple and accessible mobile banking designed to help improve financial health over time. The company’s banking platform services (or “BaaS”) business enables a growing list of the world’s largest and most trusted consumer and technology brands to deploy customized, seamless, value-driven money management solutions for their customers.
Founded in 1999, Green Dot has powered more than 33 million accounts directly, and many millions more through its partners. The Green Dot Network of more than 90,000 retail distribution locations nationwide, more than all remaining bank branches in the
1 Dayforce: On-demand pay: The benefit that helps both employees and organizations. December 2023
2 Green Dot Bank also operates under the following registered trade names: GO2bank, GoBank and Bonneville Bank. All of these registered trade names are used by, and refer to, a single FDIC-insured bank, Green Dot Bank. Deposits under any of these trade names are deposits with Green Dot Bank and are aggregated for deposit insurance coverage up to the allowable limits.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240529075885/en/
Whit Chapman
wchapman@greendotcorp.com
Source: Green Dot Corporation
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