Alternative Ways to Pay Employees Who Don’t Have Bank Accounts

When you’re onboarding an employee, it’s possible you’ll learn they don’t have a bank account where you can deposit their wages. Learn why that’s not a deal-breaker, and how you can use alternative payment methods like prepaid payroll cards to improve the employee experience and pay them efficiently.

Finding the right employees, temporary workers, or contractors takes a lot of effort. From understanding workforce demands to advertising, reviewing resumes, conducting interviews, and offering the job, it takes a lot of resources to get someone on your payroll.

Once they’ve accepted your offer, that’s when the employee onboarding begins. References? In place. Background check? Perfect. Bank account for payment? Uh-oh! 

The truth is that there are millions of unbanked or underbanked people in the U.S. and around the world—individuals who don’t have easy access to bank accounts and similar financial services. In the past, you had a couple of paper-based ways to pay these employees: 

  • Pay them with a paper check that they can take to a check-cashing center.
  • Pay them in cash. 

Both of these approaches have disadvantages.

Cashing a payroll check takes time and effort—the employee needs to receive the check, go to a check-cashing center, get the check cashed, pay a fee, and then needs to manage the cash they have. 

Paying them in cash means you need to keep physical money on hand and have someone that can check how much an employee is owed and count it into their hand. Neither cash nor checks are ideal—they have a lot of overhead and they can both easily be stolen.

There’s a Better Way: The Prepaid Payroll Card 

Fortunately, there’s now a much better option for your unbanked workforce—pay them using a prepaid payroll card. This has several significant benefits for your employees:

  • They get fast and easy access to their money, right away.
  • They can easily withdraw cash at an ATM.
  • Prepaid cards are accepted almost everywhere, at more than 20 million merchants.
  • Employees can use the cards online to pay bills and buy essentials.
  • Cards are safer and more secure than cash.
  • Employees will walk out of HR satisfied, with no uncertainty about how they’re going to get paid.

There are benefits to you as an employer, too: 

  • You can ensure your payroll is completely electronic, with no need for cash or checks. 
  • No paper means lower costs, with no need to print or post checks.
  • There’s less chance of fraud or issues with lost, stolen, or misplaced cash.
  • Prepaid payroll cards are streamlined and efficient, and easily integrate with your current payroll system.
  • Digital cards and funds can be issued immediately, with physical cards available after a few days. These physical cards can be reloaded with wages for each pay period.
  • Giving employees immediate access to their funds boosts your employer brand, which can improve morale, culture, and productivity.

Let’s explore what prepaid payroll cards really mean for the unbanked and underbanked.

Certainty and Support are Vital for Unbanked and Underbanked Employees

As an employer, providing some financial security to your employees can make an enormous difference. The Federal Reserve estimates that six percent of adults are unbanked and don’t have any access to a bank account, and 16 percent more are underbanked—they do have a bank account but largely rely on cash or other short-term financial services. This is especially true of people on the lower end of the income or education scale, including temporary workers.

Many of these individuals are living from payday to payday. The more safety and security you can provide, the more it will boost your reputation as an employer. Ready access to money reduces employee stress levels, keeps them engaged, and boosts productivity.

“Although the majority of U.S. adults have a bank account and rely on traditional banks or credit unions to meet their banking needs, gaps in banking access remain. Six percent of adults do not have a checking, savings, or money market account (often referred to as the “unbanked”). Two-fifths of unbanked adults used some form of alternative financial service during 2018—such as a money order, check cashing service, pawnshop loan, auto title loan, payday loan, paycheck advance, or tax refund advance. In addition, 16 percent of adults are “underbanked”: they have a bank account but also used an alternative financial service product.”—Federal Reserve Report on the Economic Well-Being of U.S. Households

Percentage of Unbanked and Underbanked Population




Fully banked

Family income

Less than $40,000








Greater than $100,000





High school degree or less




Some college or associate degree




Bachelor’s degree or more




Source: Federal Reserve Report on the Economic Well-Being of U.S. Households

“When you give employees a wage increase, they’re 15 percent more engaged, on average. Providing financial benefits also shows employees that the organization cares about them as individuals, inspiring loyalty, and motivation. When employees feel their employers care about their health and well-being, they’re 38 percent more engaged. Investing in financial well-being boosts the overall well-being of employees, increasing their health, productivity, and engagement. It belongs in the workplace.”—Corporate Wellness Magazine, Why You Should Focus on Financial Well-being in the Workplace

Onboarding Needn’t be a Hassle with Prepaid Cards

With all of the effort that you put into finding and hiring employees, don’t let their lack of a bank account slow you down. Offering a prepaid option shows your employee that you care about their financial wellbeing, which can boost their productivity—they get the certainty that they’ll have access to the money they need. Prepaid payroll cards create a win-win situation for everyone.