At the peak of the Covid-19 lockdowns, one way companies had to immediately digitize their systems was by accelerating on-demand business payments, like employee payments. Jason Lee, CEO and Co-Founder at DailyPay joins GlobalFinTechSeries to share his thoughts and to talk about DailyPay’s journey so far.
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Can you tell us a little about yourself Jason? How did the idea of DailyPay come about and what are some of the innovations you are working on for the near future?
I’m a financial engineer by training and spent nearly two decades on Wall Street creating numerous new products and markets to manage areas of risk.
In 2015, I saw a profound need for working Americans to have flexible access to their pay and to improve their financial wellness. So I took a detailed look at the entire landscape of how people were paid in this country, and all I saw was a mess. We have a pay system that revolves around the employer. It results in completely arbitrary decisions regarding payday schedules that don’t work for most employees. Those employees then seek financially crippling options, like payday loans, to address the gaps caused by that system’s failure.
Something had to be done to change this antiquated process. This realization became a mission. And that mission became DailyPay.
We were at the forefront of an entirely new industry. We were guided by the core principle that hard-working Americans who needed money to support themselves and their families shouldn’t have to wait two weeks or more to get paid. This delay put many in dire financial situations. The two-week pay cycle wasn’t working. There had to be a better way.
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In the near future, there is a tremendous market opportunity for this service, and DailyPay is positioned as the clear number-one player in the market we created.
We launched DailyPay in 2016 and by year-end, there was only one competitor. Today, we have 27 competitors in the United States, and 18 in other countries, including New Zealand and the United Arab Emirates. We are the gold standard in the market. We work with 86% of the Fortune 100 who offer on-demand pay.
The future of DailyPay is not just as a valuable tool within the payroll marketplace. We have created an entire pay ecosystem. We can own the entire financial experience of a worker from the time she logs her first hour of the day to the time she pays her bills and saves what is left over in her paycheck.
What are some of the biggest game-changing innovations you have seen in fintech, within the employee payment solutions space in the recent years and as a marketplace: how do you perceive this segment to shape up in the future?
We have seen a huge shift in prioritizing technology to automate payroll processes to drive down costs and streamline processes. It is also imperative that these digital transformations keep employees safe.
DailyPay has developed the game-changing CYCLE feature that enables companies to immediately reduce or even eliminate paper checks and manage final pay distribution. It can be used to provide bonuses, termination pay or to make other necessary off-cycle payments to employees, and it enables them to receive their payments electronically.
More than half of the U.S workforce have experienced paycheck errors during their careers. Companies spend substantial time and money in an effort to make payments outside of their usual payroll schedule. CYCLE was designed to support increased financial flexibility for the American workforce, which has become increasingly important during the COVID-19 pandemic.
Given the recent business challenges companies are facing due to the Covid-19 pandemic, how have you seen businesses/teams make use of their fintech applications during this time to enhance employee/user experience?
The contactless revolution is here. Businesses are searching for a viable recovery solution that offsets the loss in revenue and workers. The solution has to be inexpensive and it has to keep employees safe and secure.
For example, more employees are demanding an on-demand pay benefit, driving companies to implement an innovative pay solution. Those employers are now reaping the benefits.
According to a recent DailyPay study, 56% of employees that use DailyPay were motivated to pick up more shifts and 90% of employees shared that having access to DailyPay during the pandemic reduced their financial stress. When companies provide benefits that decrease an employee’s financial stress, employees become more productive at work.
Our partners are also reaping the benefits of new fintech applications. The hospitality industry is prioritizing safety through new technologies. For hotels, guests can now use contactless technology to check-in and skip the dreaded long line that is often waiting for us after a long day of traveling. This measure creates a safer and more time-efficient experience for the customer and front-desk employee, who can now tend to the more pressing needs of guests.
In supermarkets, scan-and-go technology has accelerated the mobile checkout experience — enabling staff to be re-deployed in other areas of the store — and also creates a safer experience for both the employee and the customer.
What are some of the near-future innovations in fintech and payments solutions that you feel will arise as a result of the Covid19 changes to life / business culture?
Even before the Covid-19 pandemic, consumers had already begun to expect more when it comes to payments- whether it’s sending money instantly to friends and family or accessing pay before payday. Covid-19 only made these expectations even higher, because the pandemic has forced all industries to undergo rapid digitization. One way companies have been digitizing during this time has been to implement on-demand pay solutions, which have the added benefits of fostering employee productivity, encouraging retention and boosting job hiring.
But not all on-demand pay programs are created equal, and there is additional room for innovation. Platform providers like DailyPay are fully digitized, and even offer tools to help payroll professionals digitize their workload (e.g., CYCLE, which allows payroll teams to disburse off-cycle payments anytime, and from anywhere). Not all providers have such capabilities, but we would not be surprised to see such innovations begin to appear in other providers’ offerings.
DailyPay is also unique in that we offer employees instant access to up to 100% of earned / unpaid pay. Our real-time payments (RTP) capabilities and gateway redundancies ensure that our service remains uninterrupted, allowing users to leverage the benefit whenever they need.
Given the rise in working remotely due to COVID-19, digital payroll solutions that enable payroll teams to “WFH” and avoid trips to the bank or post office are likely to grow. As more and more companies implement Pay Experience platforms and on-demand pay technology, we predict to see more and more companies follow their lead over time.
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How according to you will emerging tech like Blockchain/AI create an impact in this space (fintech / payment platforms)?
AI has long had roots in the business side of the financial space, including areas like credit applications or fraud prevention. But the new frontier we’re seeing is moving the rich benefits of AI to the consumer side, such as spending / budgeting analysis tools. AI can also be used to power “chat bots,” which help fintech / payments companies provide efficient user support, 24/7/365.
Blockchain continues to be a nascent space for trustless systems, but are poised to grow and develop- particularly in uncertain or developing markets.
Before we wrap up, would you like to share specific finance management or business tips for Marketing and Sales or Finance teams struggling through this uncertain time due to the Covid-19 pandemic?
My best tip for those struggling through these uncertain times is to always strive to offer a gold standard level of service for your customers. The rules of the game may change – but your commitment to your partners shouldn’t. You must never waver from the mission to provide flawless excellence in everything you do from customer service to product innovation.
When the world was forced to pause at the start of the global COVID-19 pandemic, everything changed forever. One of the key changes was at work. Specifically, work as we once knew it was shattered.
As we begin recovery, companies have the unique opportunity to re-evaluate and to do things right. Every company is being challenged to find new ways to operate smarter and more efficiently, while seeking to maintain a safe, productive, and enthusiastic workforce. But we can’t lose sight of the human experience. We can’t lose sight of the customer and their needs. The gold standard means doing whatever it takes to bring back brand loyalty and to make the customer feel appreciated and valued. And to accomplish this, at DailyPay we like to say “see the circle,”
“See the circle” means everyone is working toward the same goal. Regardless of what you’re working on, there is a circle of coworkers out there; even if you can’t see them, keep them in mind. Because it truly takes a village to be the best – to be the gold standard.
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DailyPay is the leading no-cost, on-demand pay experience platform. DailyPay delivers the most transparent, compliant, and seamless integration with existing payroll systems.
Jason is the Founder and CEO of DailyPay
