Cross River Bank has teamed up with Stripe Inc. to offer real-time wage payments.
The New Jersey-based bank, which partners with technology companies to bolster its banking-as-a-platform service, now turned to Stripe to provide customers in the gig economy with real-time access to their earnings through push-to-card payments. With the new feature, employees can pay a fee to turn on the ability to access their earnings at a moment's notice.
For example, if a rideshare driver wants to get paid at the end of every day, the driver can pay a fee to enable the feature and get paid for all the rides completed every day. The fintech payments startup will facilitate payment to the employee on behalf of the employer, while Cross River handles the back-end infrastructure, settling the transaction between the involved networks and bank accounts.
Cross River CEO Gilles Gade said that "hundreds" of Stripe merchants are ready to offer this feature for their employees, and he expects millions of people to use the new product. Stripe declined to confirm any specific names or a total number, but the company processes payments for millions of online merchants globally, a spokesperson said.
In addition to the fee that the merchant might charge its employees to enable the feature, Cross River gets paid a fee with each transaction, although the bank declined to disclose how much that fee will be. That means that the more a person requests wages in real-time, the more fees he or she will pay to have immediate access to that money.
Although the feature will be rolled out initially to the marketplace economy — workers in ride-sharing, food delivery and other freelance occupations — Gade expects it to become available to other industries in the future.
When Stripe wants to expand the offering to other sectors, "we'd be happy to consult" with them, Gade said in an interview. For the bank, it only requires scaling the current operation, a step the CEO said his bank is ready to take.