Workers at participating businesses will be able to access some of their wages as they earn them, before their standard payday.
Revolut has announced the launch of a new ‘earned wage access’ product called Payday.
Payday will allow employees at participating companies, for a “small, flat fee”, to access some of their wages as they earn them, rather than waiting for a fixed day to be paid on. People will only be able to withdraw from what they’ve already earned, so is “not a loan or credit” according to Revolut.
Payday is described as a “lower-cost alternative to credit cards or payday loans” that could help workers manage their expenses. It will, according to the company, not impact their credit score.
It added that the system will be cost free for employers and not impact their cashflow, with Revolut covering the cost between employees withdrawing the money and the time when they’d usually be paid.
Payday will plug into an employer’s payroll system and be accessible to employees through the Revolut app.
The product will initially be available only in the UK, but the company plans to expand it across Europe and US in the coming months.
Nik Storonsky, Revolut’s founder and CEO, commented: “We believe in the importance of making financial wellbeing accessible to all, and this includes focusing on the impact of financial stability on employees’ mental health.
“After the difficulties of the past year, the last thing employees need now is financial uncertainty and stress. It is important to move away from a situation where many are dependent on payday loans and expensive short-term credit, a reliance that is exacerbated by the monthly pay cycle.“
Competition between challenger banks, especially in the UK, continues to heat up, meaning companies are rolling out new features to attract customers. Revolut now has more than 16m users globally.