NTS, Inc., a business unit of First Data Corp. that serves the trucking industry, has developed a new payroll debit card that banks can use to attract commercial customers and increase fee income. Called TransPay, the technology allows
company payrolls to be transferred to employee cardholders who then can access their money at nearby ATMs. Access to ATMs is currently made possible through a relationship with CoreStates National Bank, of Philadelphia, which has its name stamped on the front of the cards. Six major banks have shown interest in adding TransPay service to their commercial business platforms, says NTS business development director Mike Brunner, though he would not name the institutions.
Every time the card is used, the bank sponsoring the card collects a fee. The system is currently set up so that the employer pays for the first transaction fee, loading the paycheck onto the card. Employees pay a $2 or $3 fee per subsequent transaction.
When an employee receives a payroll or expense reimbursement electronically through TransPay, the employee can withdraw the funds at an ATM, generate personal checks through Western Union or transfer money into a savings or checking account. The card is accepted at ATMs in the MAC, Honor and Plus networks.
TransPay works best for companies with many remote employees and traveling sales forces, such as Dallas-based Claim Services Resource Group (CSRG), a temporary medical and dental staffing agency and the first national firm to distribute the cards. CSRG employs as many as 2,000 people over the course of a year, many of whom have heavy travel schedules. CSRG's chief financial officer Phyllis Farragut says that TransPay has cut payroll time by 75 percent because the accounting department can simply go to the computer to make employee money available. Says Brunner, "Businesses that will benefit most are those that produce a central payroll and have many remote locations with employees scattered around the nation, (where the company) must deliver overnight express paychecks. TransPay eliminates couriers, cuts labor and distribution costs, and reduces fraud. Security is maintained by a multi-level password system."
The card is also an indirect way for banks to service unbanked workers, winning business away from check cashers. "(One) target market is unbanked employees, those 20 percent of the population who can't get a bank account for any reason," says Brunner. But the card also compliments the banking system. "An employee can transfer funds from the card to up to three bank accounts," he says.