How does Direct Deposit work for employees to get paid early

direct deposit

‘If an organization decides that it will pay some or all of the employees via direct deposit. It helps simplify the amount of work that needs to be done when it comes to paying employees.

What is a Direct Deposit?

It is an electronic method used to deliver payroll. It is an alternative to issuing paper paychecks and eliminates the need to pick up and cash a check to access funds. It’s the fastest, simplest, secure, and most reliable payment method available.

How does Direct Deposit Work?

Initially, one has to set up a direct deposit once with the payer, and then the recurring payment appears in the account every time the buyer initiates one. For example, consider an employer’s payroll where the employer instructs the bank to transfer payroll earnings into the accounts. On payday, the bank credits the funds to the account, and the employer’s bank debits their account for the same amount.

Facts of Direct Deposit:

  • It’s safe. No more lost, stolen or misplaced checks.
  • It saves time. No more long lines at the bank waiting to deposit your paycheck.
  • It’s reliable. The money will be available the morning of the payment or sooner.
  • It’s convenient. You don’t have to go to the bank to cash your check.
  • Each paycheck will be deposited directly into the accounts which have been designated in the days that have been chosen. Like schedule deposits 2 to 45 days in advance.
  • It helps to manage the money. One can usually have the paycheck deposited directly into more than one account (such as a savings account).


Safety & Security- Almost 85% of identity theft starts with offline transactions, in other words, with a lost or stolen check or billing statement. Direct deposit eliminates the possibility of losing or having a check stolen and therefore reduces the risk of identity theft and fraud.

Eco-Friendly- Going paperless doesn’t mean just saving the trees used to make the checks, one can also save fuel and cutting the emission of harmful greenhouse gases into the environment. Direct Deposit reduces the usage of paper as all the details will be available online.

Reliable & Flexible- Direct deposit takes place electronically, thereby avoiding third-party delays from couriers and eliminating the risk of having checks lost in the mail. These are easy to set up and easy to change or cancel. By just is submitting a new direct deposit authorization form and/or written confirmation of the request to the payer.

By taking advantage of direct deposit on can opt for convenience and cost-saving fund transfers.

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