TECHNOLOGY
Fintech’s entry into payroll
Jaspal Randhawa ChMCIPPdip EMEA head of products at OneSource Virtual discusses the growing trend of fintechs partnering with payroll software providers
P ayroll has traditionally been viewed as a back-office process. However, over the last few years, the emergence of technology, such as APIs (application programming interfaces), is allowing two applications to talk to each other. Much like bank transaction data in the late 1990s, API access to payroll data was only possible once the systems that held the data started to move to the cloud. As a result, sharing data is much easier, thus opening payroll systems to a new world of possibilities, which could involve supporting the organisation’s strategy in areas such as managing financial transactions and providing data. Why are fintechs partnering with payroll software providers? Consider all the data payroll systems hold on individuals and the overall value of payment transactions that occur each pay day. It’s no wonder fintechs are keen to
partner with payroll software providers. It’s worth noting, however, that some fintechs are introducing their own payroll solutions, typically aimed at small and medium-sized enterprise businesses with less complex payroll requirements. They’re therefore establishing themselves as employee benefits platforms, partnering with employers to be a one-stop destination. They’ll quickly Consider all the data payroll systems hold on individuals and the overall value of payment transactions that occur each pay day
onboard employers for payroll processing and offer additional features that can be added either as a bundle or separately. As these companies continue to innovate and expand their offerings, the impact on the financial lives of consumers deepens. How are fintechs evolving? Handling pay and disbursement transactions opens the gateway for fintechs to provide other products and services, such as: ● earned wage access ● savings ● digital wallets ● other financial products, made possible due to technology evolution. This allows fintechs to offer products and services directly to employees via mobile apps, which provides a seamless experience. Some fintechs provide employees with a bank account to receive pay into, by banking through their employer’s partnership with a payroll platform.
| Professional in Payroll, Pensions and Reward | June 2022 | Issue 81 32
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