Payments Personalization Equals Gig Marketplace Dominance

Companies that can make immediate worker payouts are poised to outcompete those that can’t.

Personalization in banking and financial management is critical. Today, customers have high expectations for a cohesive financial experience, and the banks and companies that refuse to adapt will certainly be left behind.

According to a survey from J.D. Power, 78% of banking customers expect a personalized banking experience—but personalization doesn’t end at the bank. People want personalization throughout their financial experience, from money management to how and when they receive a paycheck.

Companies with gig workers and independent contractors are launching personalized payment programs to meet this demand, but not every company is getting personalization right.

At its core, personalization in payments is about doing what is fast, easy, most convenient and, most important, most relevant for the client or employee. Companies that meet workers on their terms will reap the rewards. Banks that invest in personalized services have seen a 5% to 15% increase in revenue, and companies that lean into personalized payment methods stand to unlock similar value in their workforce—the front line of their business.

Companies will see loyal, consistent, and productive gig workers and independent contractors repeatedly coming to the organization. To advance personalized payment platforms and create a truly bespoke experience, companies should incorporate four key components in their payment strategy. Here’s what they are:

Multiple Payment Methods

Today, people have multiple ways to make a payment, from credit cards to wire transfers to digital wallets. People can even transfer money between friends and family with the simple touch of a button.

Employees expect the same level of flexibility when receiving a paycheck. Gig and independent contractors in particular want the option of receiving a payment through multiple means— plastic or virtual cards, direct bank transfers, the automated clearing house, and so on. And companies need to provide multiple payment methods to payout a provider.

Payout orchestration is critical to personalization. Payout orchestration enables one company (the payor) to connect to numerous payment processors simultaneously and in real-time, and determines the fastest, most cost-efficient, and preferred way to send a payout to the recipient.

Gig and independent contractors are a diverse group of people, and may include individuals who are unbanked or underbanked, or have access to different technologies to collect payments. It is important for a company to have the ability to tap into the myriad payment methods available to meet each individual’s needs.

Beyond personal banking habits, gig and independent workers also need to create consistency across working platforms. These workers typically work for multiple organizations, but managing different payment methods on different platforms is difficult.

By providing multiple payment methods, payors allow gig and independent workers to tailor their work experience to best fit their needs and more easily manage their jobs and income. Gig and independent workers are more likely to choose and return to organizations that provide their preferred payment method.

A Variety of Currencies

The advantage of gig and independent work is flexibility. Gig and independent workers can take on a job at any time, and often at any location, on demand. For workers, there is a tremendous advantage to this flexibility in that it creates a personalized work-life balance that best fits their needs.

But companies have an advantage, too. Gig and independent workers give companies access to a global workforce, tapping into talent and skill sets far beyond what is available locally. This can be highly valuable to companies. But, of course, to access it you must be able to pay workers in their preferred currency.

Often, companies think currency diversification is too challenging. It requires managing fluctuating exchange rates, not to mention understanding local banking infrastructure and legal payment requirements.

But partnering with a third-party technology company can streamline the management of these functions to ensure that employees can be paid in their preferred currency while also navigating local rules and regulations. This allows companies to create a hyper-personalized payment experience that attracts global talent.

Domestic employees are also increasingly requesting payments in alternative currencies. According to a global poll by financial-consultancy firm the deVere Group, 33% of Millennials and 50% of Gen-Z would like to receive their salary in some form of cryptocurrency.

In another survey from SoFi at Work and Workplace Intelligence, 42% of workers said that they would like to receive non-fungible tokens as performance rewards.

These trends illustrate the importance of creating a payment platform that can deliver payments in a variety of currencies.

On-Demand Payments

On-demand work is not a new concept. Employees have always been able to pick up on a job or work on a project basis. Historically, when someone finished a job, they were paid immediately. Modern banking changed that, making workers wait for a check or ACH payment, even for just one day of work.

Under this system, it can take days or even weeks for an employee to receive a payment. That is too long, and it can deter workers from accepting gigs or returning to the organization.

On-demand workers expect on-demand payments. They complete a task or a sale, and should be able to receive a payout for their work, completed in real time. The concept of real-time payouts is exploding across industries, and it can help attract workers.

PayQuicker’s research found that 83% of gig workers think it is important to be paid in a timely manner, and this opinion could affect the jobs they choose to take. On-demand pay should be seen as a requirement for any worker that falls under the on-demand umbrella, including companies using gig and independent workers in today’s market.

Automation in Payments

What we’ve discussed so far are actions that companies should take today to advance personalization in payments. But artificial intelligence, automation, and other progressive technologies are sure to alter the payments landscape once again.

Payments companies are already leveraging payments data to track consumer preferences, common payment methods, and frequency of payments to build a payments service that meets market needs. In the future, AI will unlock even more features. For example, employees may be able to direct payments or portions of payments to different accounts, or even to pay bills or make investments directly from a paycheck.

From the company’s perspective, AI could streamline payments departments, allowing them to automatically process invoices, deliver payments, and record payments for accounting teams. To stay ahead of these coming developments, companies should be investing in AI tools today.

Personalization in the payments landscape is just as important as personalization in banking and financial management. It is essential to a successful payment transaction. The companies that are already investing in personalization are poised to win— and this applies to every industry. Companies that empower individuals to dictate how and when they get paid will gain a true competitive advantage.

—Gabriel Grisham is senior vice president of global sales at PayQuicker.