When starting a new business, there are a lot of things that need to be handle. At some point, after you get things up and running, you will have to address the area of payroll. Not only will you have to decide when you will pay your employee, but you will also have to determine how they will be paid. Many employers choose to pay their employees with a paper check, while others choose direct deposit.
Here are 3 benefits of direct deposit.
One of the biggest benefits of direct deposit is that people are able to save money on printing fees. It takes
money to print and reprint paychecks that will be sent to your employees. Depending on how often you pay them and how many people you employ, you can reduce the fees, but with direct deposit, there is no cost for paper, ink or even stopping payments should a check be lost or stolen after it is sent out.
Direct deposit can also help companies save a lot money on distribution costs. After you have printed your employee's checks, they will have to send them to their homes. This means that there is money that will be spent at least once a month ensuring that employees are paid. Over the months and years, this cost can amount to thousands, which could be spent on things that the company really needs.
Lower Risk of Identity Theft
When a check is sent in the mail, there is personal information on them that anybody can have access to if they get a hold of it. People have their identities stolen every day and don't know how it happened, but if they have ever had a check stolen, it is possible this is how. If employees receive their pay through direct deposit, strangers won't be able to steal their checks and cash them or have access to personal information that will allow them to steal the person's identity.
After employees receive their checks, they have to go to their banks to deposit it. They will have to drive there and stand in line for an undetermined amount of time, which is something not many people can say they enjoy, especially if the bank full of other people who are also trying to deposit their checks. Why have employees stand in line when they could just have their check deposited directly into their account? They will save both time and money.
Running a business involved a lot of decision making, but also standing behind these choices, even when it comes to payroll. There are many decisions about payroll that people can make that will benefit their business in the long run. Business owners may feel as though paper checks are the best option, but when looking at direct deposit and its perks, they may change their minds. At the end of the day, if you don't think direct deposit is better for your business, you can always go back to you using paper checks.