With more companies hiring remotely and employing workers located in areas subject to different local laws and anti-money laundering regulations, processing international payroll payments has become more complex in recent years.
This has made the role of last mile partners critical, according to Eynat GuezCEO of a cross-border payroll management company based in Israel world papayahighlighting recent Partnership with JPMorgan.
Announced in October, the deal gives Papaya access to the bank’s global financial infrastructure and payments network, which the company leverages to deliver compliant and secure payroll payments through a single end-to-end platform. boils in 72 hours in more than 150 countries around the world.
As Guez told PYMNTS, “Our customers and everyone who uses Papaya can rest assured that once they process payroll with us, their employees will be paid correctly and on time in any country in the world. .”
Regarding payments in multiple currencies, she said the ability to pay an employee’s preferred currency has been challenged by regulations in most parts of the world, which require salary payments to be paid. in local currencies.
Overall, however, Guez’s view is that currency is going to be the new “world order” in payroll payments, with more individuals capitalizing on double-digit currency swings to earn substantial income without too much effort.
Crypto: new payroll option?
Whether making payments to local bank accounts, digital wallets such as PayPal, or even paying directly in digital assets, there is a growing demand for payment flexibility worldwide from international workers.
For those in countries with highly volatile markets or places with liquidity issues like Ukraine and Russia, Guez said demand for fast, low-cost cryptocurrency payments has increased. over time.
But as employees increasingly embrace the option of having some of their savings invested in virtual assets, she pointed to some concerns, including that digital currencies are still not assets that can be liquidated often or exchanged on a day-to-day basis to buy groceries, for example.
Increasing regulation in the space has also not helped, adding further complexity to crypto payments associated with payroll, she also noted.
“About two or three years ago it was much easier because governments [were still behind in catching on to the trend]but all of a sudden [that has changed]“, she said, adding that apart from the United States, which has made it relatively easy to pay in crypto, most countries have made it very difficult for employees to hold crypto.
Extension of benefits
The world of employment has undoubtedly changed in recent years, paving the way for sustained telecommuting and hybrid work for most companies.
Trends such as pay-as-you-go have also gained traction as more workers seek access to their wages before the end of the government-regulated monthly payment cycle commonly used in most parts of the world. .
“There is almost no logical reason why [employees] shouldn’t be paid sooner if they stay [on the job] and work for the whole month,” Guez noted.
She added that quick access to wages is even more critical in this current macro environment of high interest rates to prevent workers from relying on predatory payday loans to make ends meet.
See also: Avoiding International Payroll Missteps
In this context, she said employers would play a bigger role in initiating short- and long-term loans rather than banks, using balance sheet liabilities such as paid vacation (PTO) or severance pay. departure that are unrelated to salary payments.
With these cheaper financial services and benefits, employees who need access to funds above their salary, to buy a vehicle or cover wedding expenses, for example, can turn to their employer to make up the shortfall. financial.
This is an area where global payroll providers like Papaya, which have access to massive amounts of employee data, can also help.
“We can estimate [employee] risk just like the bank would and also have full visibility into the liabilities an employer has on the balance sheet – so why can’t we create a place where those needs are met? Guez argued.
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