To combat overdraft, payday loans, and late fees, DailyPay updated its existing digital wallet program with a feature that lets users see their hard-earned cash in their accounts arrive in real-time.
“We’ve enhanced it so you can see your transparency and see how much you’ve earned in real-time,” Jeanniey Walden CIMO said.
She said that “the majority of the millions of workers that have access to DailyPay will log in and check their daily balance eight times a week, compared to people checking their bank account balance, you know, twice a month, typically on the day they pay rent.”
The Feature, called DailyPay Balance, was announced on Jan. 5.
DailyPay has offered participating employers the ability to allow workers to receive their wages earlier than every month or every two weeks.
Through partnerships with 6,000 banking “endpoints” or wage service partners, the firm offers next-day wages for free.
DailyPay makes its revenue from the instant payment option, which lets users get wages on the same day for a fee of $2.99.
“It is way less than a traditional ATM fee, especially in Vegas where last night I took money out, and they charged me $10,” Walden said from the CES conference in Las Vegas, that she said was “about 15% of what it normally is” due to the surge in Omicron COVID-19 cases.
Better wallets as a DailyPay baseline
Walden said the team at DailyPay updated the wallet to add another layer of function and to enhance access to financial services. Fintech services are everywhere, but they are not very useful to those who don’t have cash in their bank account in the first place.
“But behind the scenes, we started to look at all these fintech solutions, and we’re like, these are great if you have money, but if you don’t have any money to put into the economy or into a wallet, digital or physical, then you can’t benefit from anything that fintech-related,” Walden said.
“Most digital wallets today are underutilized because they’re frequently empty,” Jason Lee, DailyPay Founder, and CEO said in a release.
“That doesn’t benefit anyone. The DailyPay wallet solution changes this by constantly refilling with the money you earn at your job in real-time. If you are working, your DailyPay wallet will never be empty, giving you access to your money whenever you need it.”
According to Walden, the average DailyPay user sees savings of $1,200 a year from overdraft fees or late fees.
“If you’re an hourly employee and your making minimum wage, that’s equivalent to a 7% pay increase,” Walden said.
She also noted that a study found 91% of users reported that they never took a payday loan, and 97% stopped getting hit with overdraft fees.
Last May, DailyPay enjoyed a $175M Series D equity round, alongside $325 in debt or credit capital.
Last year, some financial institutions showed interest in embedding DailyPay capability in their products.
DailyPay launched the Extend PX product to white label their proprietary API as embedded software.
More unique products that add value, such as within the DailyPay wallet, are coming up in 2022, Walden said.
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