Pay Cards: Play By The Rules Or Risk Paying Twice

As our world becomes more electronic and individuals become more accustomed to paying for goods and services with the swipe of a plastic card, employers and sometimes even employees are attracted to  pay cards.  A pay card is nothing more than a stored value card provided by a financial institution that works like a traditional debit or ATM card or the increasingly popular gift card.

In the employment arena, an employer contracts with a service provider to have the wages due to employees transferred onto a pay card each pay period.  Then, the employee uses the pay card to access his or her wages by either withdrawing funds or using the pay cards in the same manner as a debit card.  For employers and employees comfortable with such electronic transactions, a pay card may be ideal.  However, both employers and employees should keep certain things in mind.