What are the benefits of real-time payments?

At Income Group, we’re dedicated to revolutionising payroll payments through our real-time payments system, IGsend.

IGsend seamlessly integrates with existing payroll processes, providing payroll and HR teams with more flexibility around how and when they pay employees.

In this blog, we explore the benefits of real-time payments in the UK in more detail and how they could provide a much-needed solution for time-poor payroll teams, who are plagued with the same challenges month on month.

What are real-time payments?

Real-time payments are payments that are made, settled, and cleared within seconds.

They can be processed 24 hours a day, seven days per week, 365 days a year. They are always online and always available to transfer, even if it’s a bank holiday, a Sunday or even 9pm on Christmas Eve!

We’ve become used to moving money at the merest touch of a button, repaying small tokens such as coffee with a friend, to transferring significant sums of money for large-scale purchases, such as car or house deposits.

However, when it comes to payroll– which is one of the most important payments a person can make or receive – and B2B real-time payments, payment processes have not yet evolved, with many businesses relying on BACS transfers to pay employees, which has set cut off periods that prevent staff from being paid quickly.

Payroll payments in 27 seconds

Understanding real-time payments

Real-time payments are considered a form of faster payments, but with certain deciphering features.

Faster payments are settled faster than traditional payment systems, but they are not instantaneous transactions where funds are transferred within a matter of seconds.

Both real-time and Faster Payments provide a more flexible solution than traditional BACS, which is the payroll system still used by many companies in the UK.

Faster Payments, and more recently, real-time payments are an emerging trend in the financial sphere and are dedicated to bringing the immediacy we’re accustomed to in other areas of our lives, to the most important deposit in many people’s bank accounts – their salary.

What is BACs payment?

BACS was created more than 50-years ago at a time when the bank branch was central to business. All money-related business was conducted between core business hours, Monday to Friday, making it inflexible and often time-consuming to rectify, if mistakes are made.

The average BACS payment time is three days, and funds can only be cleared on business days (Monday to Friday) and have strict cut off times, whereby payroll professionals need to submit payments well in advance to ensure that it is sent on a certain day.

In today’s digital-facing world, the BACS payroll payment services have rapidly become outdated. People no longer live their lives aligned to a strict nine-to-five schedule and increased innovation and flexibility are key to giving employees increased control over their pay.

With many businesses continuing to rely on largely outdated BACS payments, there are numerous blockers for payroll teams looking to make slick payments every month.

Convenient, quick, and digitally-enabled payment processes are better suited to our digital-first world and align more closely with consumer – and employee – demands.

Real-time payroll payment systems

Over the past decade, we have seen a seismic shift in how we all live our daily lives. We have transitioned into a digital-first world where much of our lives are played out online; from online grocery shopping to cashless payments and paperless communication, information can be found in just a few clicks.

The COVID-19 pandemic dictated a refreshed approach to daily life. The enforced lockdowns meant that companies needed to support employees through a flexible working structure, so that they could balance other commitments, such as childcare.

This hybrid approach has remained a priority for many businesses since moving out of lockdown, with reports showing that just four per cent of UK businesses are not implementing any form of hybrid working at all. Most employees enjoyed the added flexibility of combining remote and office-based working, and companies seem largely happy to embrace this.

The importance of financial wellbeing 

Financial wellbeing is no longer a “nice to have”. Money worries have a significant impact on our mental and physical health which can, in turn, impact our performance at work.

This is another area that has been significantly impacted by the pandemic, which hit many financially, particularly those reliant on government schemes such as furlough.

Having a flexible, integrated payroll payment system can be a vital part of supporting employees’ financial wellbeing, which in turn contributes to their overall mental wellbeing.

Paying people accurately and on time has never been more important, and people rely on the regularity of payments to allow for accurate financial planning – especially those living pay day to pay day.

Not only will better payroll software integration help reduce the administrative burden on payroll and HR teams, but it will also offer employees increased flexibility around how and when they are paid. 

Introducing IGsend 

IGsend is Income Group’s innovative payroll payments solution, enabling payroll teams to make instant, real-time payments, 24 hours a day, seven days a week, 365 days a year.

It integrates seamlessly with existing payroll processes, with no changes.

We developed IGsend to respond to the significant challenges faced by payroll teams using outdated BACS systems. IGsend removes payroll cut off deadlines and ensures that payments are made instantly; on time, every time.

We’ve developed the platform in partnership with Zellis and Mastercard to bring faster payments for payroll to Zellis’ UK customers, which include a third of FTSE 100 companies. IGsend is also approved by the Financial Conduct Authority.

Income Group is dedicated to revolutionising payroll to address some of the issues outlined above, and ensure that the UK is open to taking an innovative approach to payroll systems to ensure future resilience, increased flexibility, save time and money and promote happier employees.

Find out more about the IGsend platform and book a demo here.

Can you change from monthly to weekly pay?

Can you Change from Monthly to Weekly Pay?

Financial needs vary from person to person so the traditional monthly pay cycle might not ...
Read More →

Choosing the Right Finance Solution for Your Business.

Choosing the right finance solution for your business involves carefully considering various factors, such as ...
Read More →
5 Employee Benefits to Help Boost Staff Retention

5 Employee Benefits to Help Boost Staff Retention

Benefits are essential to help your employees feel appreciated and valued. When looking at job ...
Read More →

See how much you can save by using EWA

Click/tap to load our interactive calculator and find out your cost saving in seconds!