Payroll debit cards, or paycards, work similarly to credit cards or bank debit cards. Every payday, the employer loads the card with the net wages the employee is due to receive. The employee then has a choice to go to a bank and withdraw the entire sum, or to use the card as one would use a credit card or debit card at retail locations or automated teller machines. Depending on the manner in which a paycard is used, and the bank that issues the paycard, fees may attach to certain uses of a paycard. Because paycards offer a convenient method of payment to “unbanked” employees and avoid the administrative costs of issuing paper checks, payroll debit cards are increasingly used by many employers.
Home > State Law Articles > Illinois > Wage & Hour (IL) > Illinois Statute Clarifies Circumstances When Employers May Pay Wages Via Payroll Debit Cards