More NewsBanks Have Opportunity to Switch Customers to Direct Deposit, Finds Survey

Banks Have Opportunity to Switch Customers to Direct Deposit, Finds Survey

A new survey by NACHA, the electronic payments association, reveals that banks/financial institutions have huge opportunity with small business customers’ adoption of direct deposit. Half of small business owners surveyed say they have not been approached by their bank about direct deposit – a cheaper, greener way of managing payroll.

The survey reveals just 52% of small businesses use direct deposit for employee payroll – missing a huge opportunity to reduce their carbon footprint and save money and time.

The survey also found:

  • Almost half (48%) of small businesses overall do not use direct deposit.
  • Over a third (34%) of businesses with two to 100 employees use direct deposit (22.8 million employees).
  • Forty percent of non-users said they would consider it for the future, while 19% were unsure.
  • Eighty-two percent of employees whose employers offer direct deposit use it.
  • More than three-quarters (77%) of employers report time saving as the number one reason to use direct deposit; 48% report cost savings as the number two top motivator; and 44% say ’employee request’ is key motivator.
  • Almost one-third (30%) of employers who offer direct deposit say they have 100% employee participation.
  • Almost two-thirds (63%) of employers report being ‘satisfied’ or ‘very satisfied’ with direct deposit.
  • Over one-third (34%) of small business owners say the specific reason they don’t use direct deposit is because no one has approached them.

The survey reveals the best messaging for banks to encourage use of direct deposit is by stressing time savings, environmental impact and the fact that direct deposit is a ‘valued employee benefit’.

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