The Rise of the Gig Economy: Why Immediate Payouts are Key to Attracting and Retaining Top Talent

The COVID-19 pandemic and the resulting economic turmoil have prompted significant changes in the payment industry. Digital banking has rapidly replaced physical banking, with ATMs and physical branches being removed or closed, and cash usage declining. Meanwhile, electronic transactions are on the rise like never before. Amidst all this, the gig economy has emerged as one of the fastest-growing industries in recent years.

But what is the Gig economy exactly? A gig economy is a free market system in which temporary positions are common, and organizations hire independent workers for short-term commitments. Gig workers are independent contractors, online platform workers, contract firm workers, on-call workers, and temporary workers typically working for delivery or food delivery platforms such as Uber Eats, Doordash, or freelancers working on TaskRabbit, and Fiverr, among others.

As the world transitioned to online platforms during the pandemic, the gig economy experienced explosive growth. Prior to COVID-19, around 36% of U.S. workers (roughly 57 million people) were part of the gig economy, according to Gallup and Statista. In 2023, the industry is expected to welcome 73 million workers, marking a 28% increase from pre-pandemic levels, according to the same sources. This rise of gig work across numerous sectors highlights the pressing need for streamlined, fast, and transparent payout solutions.

Gig workers: Challenges and Solutions

According to the daVinci Payments Study, 70% of gig workers would be more loyal to their employers if offered same-day pay. However, many gig platforms, like Airbnb and Etsy and especially startup platforms, don't offer immediate payment options, which can be a challenge.. In some cases, gig workers might not be able to afford essential expenses such as fuel costs if they have to wait for payment after a certain number of rides or services. Additionally, cross-platform money transfers can be inconvenient and expensive for international gig workers, further complicating payment processes.

For some gig workers, it might come as a Catch-22: imagine a food delivery driver that cannot afford to pay the gas fee, as they are paid after a certain amount of food deliveries. 

Nothing boosts productivity like timely payments 

At Lynk, we understand the importance of immediate payouts to gig workers. Our immediate Pay by Bank feature allows gig workers to get paid quickly and easily, setting your business apart from competitors that don't offer this option. In addition to lower processing fees, (0.5-1% vs. 1.9-5% for traditional card payment), merchants can reduce their transaction failure rate to nearly zero (compared to 11.5% for digital wallets and 7.9% for traditional credit cards). 

Furthermore, our interchange revenue-share model means that disbursements can become more than just a cost center, generating revenue for your business. By issuing virtual cards to contractors, vendors, customers, and other ecosystem partners, you can provide them with quick access to their funds while benefiting from the interchange whenever those cards are used. This approach helps your business run smoothly and attracts and retains top talent in the competitive gig economy.

Immediate payouts are crucial to attracting and retaining top talent in the gig economy. Lynk's immediate payroll access feature provides a convenient and efficient solution for gig employers, making it easier to pay workers quickly and ensuring your business stays competitive.

If you are interested in learning more about immediate payments, feel free to book a personalized demo with one of our experts: Book a demo.