Uber Can Learn From Walmart’s Employee Mobile Wallet Experience

Uber could well be the next uber employer to be offering employees access to a payroll-based mobile wallet that provides financial benefits, including financial loans.

Recently, the listed ride-hailing business, which has 19 000 employees worldwide, sent out an in-app message to some of its drivers saying it is building a new financial product to help Uber drivers with their finances.

But if Walmart’s experience with its mobile wallet for employees is anything to go by, Uber needs to focus on providing financial wellness tools and not just loans when introducing the wallet to employees. 

Walmart partnered with Even Responsible Finance Inc at the end of 2017 to offer its 1,4 million US-based employees a discounted subscription to the financial wellness mobile wallet. By July 2018, more than 200 000 employees were making use of the mobile wallet regularly. However, there were concerns that employees would use the mobile wallet predominantly to tap advances on their pay at the expense of their financial wellness. 

Jon Schlossberg, Even’s CEO, countered these concerns saying that the mobile wallet was far more than a facility that offers early access to wages and that its primary aim is to improve the financial wellness of its users. Additional wallet functionalities include instant budgeting, automatic savings, and notifications of how much is okay to spend based on the user’s spending and earnings history. 

However, comments by employees on Reddit about the wallet since being introduced highlighted that employees were focusing on the pros and cons of early access to wages, without giving due consideration to the other financial wellness components of the wallet. 

The mixed reception to the Even wallet and early concerns about Uber venturing into employee financial services highlights the challenges of introducing any new technology. The good news is that recent research conducted by ADP in a report titled “Evolution of Pay” highlighted that employees are certainly open to considering other forms of non-traditional payment, particularly mobile wallets. However, historically, it has usually taken time to transition from one method of payment to another. 

“While technological and social change continues at an ever-increasing pace, payment methods and technologies have often lagged behind. History has shown that, while new payment practices may ultimately gain wide adoption and acceptance, the path to getting there is not always simple or direct,” say authors Ahu Yildirmaz and Sara Klein

For instance, when salary payments by direct deposit became an option in the 1970s and 1980s rather than paper checks, which had dominated payments for many decades, there were concerns about security and access to cash. Today it is the norm. In North America, ADP found that more than 80% of employers still pay employees by direct deposit and that an equal percent of employees prefers it. 

Looking to the future, almost half of the employees surveyed in the US said they were willing to accept non-traditional payment methods, including digital platforms, mobile payments, or pay cards. In addition to being willing to be paid by non-traditional methods, they believed their employer could be a reliable source of advice regarding financial wellness.

Forward-thinking employers who are willing to go on this journey with their employees have much to gain. Embracing this mobile payment technology and what it offers their employees could well put them in the lead when attracting and retaining top talent. 

Within the context of the Uber and Walmart, however, it will be important for employers to give employees access to the full array of financial wellness tools, including financial guidance and well-designed retirement and day-to-day savings options. 

The ADP research found that advice on how to manage expenses could be a differentiator for potential talent. “Over 60 percent of employees indicate that advice related to managing health-care costs, retirement planning, and debt — along with money management tools — would make a difference in their consideration of a job offer.”

All of these services can be wrapped up into a company-branded mobile wallet. Several reputable white-label mobile wallet providers offer white-label mobile wallets that can be tailored specifically for employers. They can be developed cost-effectively, are scalable, and can be easily adapted over time to changing employee needs and preferences.

Developing a company-branded mobile wallet for employees offers employers a chance to differentiate themselves even more distinctively from their competition when attracting new talent into the business. In a white paper, Using Mobile Wallets as a Company Payroll Solution, Velmie, a mobile wallet software provider, explores the valuable role a company-branded mobile wallet can play in attracting talent and building loyalty among existing employees. 

The benefits of developing and introducing a company-branded mobile wallet over outsourcing mobile payments to an external provider are that:

• The employer can craft and own the entire employee experience

• It maximizes the trust most employees have in their employer to put their financial interests first

• It facilitates their financial wellness, which, in turn, has a positive impact on their productivity. 

A company-branded mobile wallet can offer employees access to a wide range of financial services, including salary deposits, bonus payments, loan facilities, transactional capabilities, currency transfers, loyalty and reward programs, access to retirement or Section 401(k) plans, gamified financial guidance and financial product offerings, such as long-term and short-term insurance, and investment and savings options.

Almost 80% of the 4,006 employees across 13 countries surveyed by ADP say they want to work for an employer who cares about their financial wellness and are open to non-traditional payment solutions. Investing in carefully designed and patiently introduced company-branded mobile wallets as payroll and employee financial wellness solutions could pay off for many years to come.