Direct Deposit

Benefits of Direct Deposit

No matter what size your company, Direct Deposit offers tangible benefits, from cost savings to increased operational efficiencies at all levels. A few of the benefits include the following:

Direct Deposit is simple.

  • Direct Deposit simplifies the account reconciliation process. The account statement will show a single dollar amount for the total amount of the Direct Deposit transactions instead of individual check amounts to reconcile.
  • Setup for Direct Deposit is easy. Contact your financial institution, payroll processor, or business software provider to begin.
  • Direct Deposit can simplify the labor and time processes involved in payroll processing because it requires less manual handling.

Direct Deposit is safe.

  • Direct Deposit payments are never lost or stolen.
  • Direct Deposit uses the ACH Network, a safe and secure payment network used by banks, credit unions, and the U.S. government to send and receive payments each day.
  • Direct Deposit reduces the likelihood of fraud, because there is less potential for counterfeit or stolen checks, altered amounts, and forged signatures.

Direct Deposit is smart.

  • Typically, it costs more to process a paper check than a Direct Deposit transaction.
  • The potential for error is reduced because Direct Deposit requires less manual handling than a check.
  • Problems with Direct Deposit are rare. If there is a problem, the dispute resolution process is simple and straightforward. The transaction has an electronic trace from start to finish.
  • Direct Deposit could increase productivity. According to NACHA - The Electronic Payments Association, employees spend between 8.5 and 24 hours per year going to the bank or credit union to cash or deposit their paychecks, an activity which accounts for an estimated $3-$5 billion loss in productivity annually.
  • Direct Deposit is a smart way to help the environment. Each year, checks use more than 674 million gallons of fuel and add 3.6 million tons of CO2 to the environment as they travel through the payment cycle.
  • Direct Deposit reduces the reliance on paper checks and administrative costs associated with producing payroll checks-less check stock to buy and store, less wear-and-tear on printers, fewer envelopes, etc.

Fast Facts About Direct Deposit

  • Direct Deposit is the electronic transfer of a payment from your company or organization into an individual's checking or savings account.
  • Direct Deposit is an ideal way to manage employee pay, travel reimbursements, tax refunds, pensions, dividends, bonuses, and more.
  • Most large companies (500+ employees) and many small- and medium-sized companies offer Direct Deposit. It has become a staple in today's employee benefit packages.
  • Businesses of all sizes can offer Direct Deposit. Companies can save anywhere from $2.87 to $3.15 per payment by using Direct Deposit instead of paper checks. Many payroll software packages, as well as independent processors, can provide a Direct Deposit solution.
  • Employees who use Direct Deposit can access their money in their accounts at their financial institution's opening of business on payday. They never need to go to the bank during business hours to deposit their pay checks.
  • Problems with Direct Deposit are very rare. if there is a problem, it can usually be resolved with as little as one phone call.
  • Ninety-seven percent of those who use Direct Deposit are very satisfied with it.
  • Three out of four employees who have Direct Deposit available use it.
  • Direct Deposit is the most widely used ACH payment. In 2008, the number of ACH payments topped 18.2 billion, representing an increase of 1.2 billion over 2007.
  • Financial institutions and governments use Direct Deposit to transfer millions of dollars every day. Your employees' money is safe with Direct Deposit.