From the July-August 2010 issue of Treasury & Risk magazine

Small Firms Still Paying With Paper

Paying employees via direct deposit rather than with paper checks provides big green benefits. But a recent survey shows small businesses are still not on the direct-deposit bandwagon.

Seventy-two percent of the more than 4,000 employed adults surveyed by NACHA, the electronic payments association, say their pay is deposited directly, while 27% get a paycheck and 1% are paid in cash. That's up from the 66% paid via direct deposit in a 2008 survey by the Consumer Federation of America.

But only 48% of employees at businesses with fewer than 100 workers are paid via direct deposit, and just 35% at firms with fewer than 30 employees.

NACHA estimates using direct deposit saves companies between $2.87 and $3.15 per payment. It also shrinks their carbon footprint: NACHA estimates that a business that pays its 300 employees every other week could save 121 pounds of paper a year and avoid the release of 346 pounds of greenhouse gases by switching to direct deposit.


Advertisement. Closing in 15 seconds.