Living Paycheck to Paycheck? FinTech Can Help

It’s a depressing and common notion that most Americans are one paycheck (or emergency) away from living on the street. Not surprisingly, the 1% don’t seem overly concerned with the plight of the common worker and continue to enforce a status quo that benefits those on top while forcing the common man to subsist on a payment schedule chosen by the elite.

What, then, do these everyday folk do when they find they are unable to manage with infrequent payment schedules?

FinTech has the answer. Active Hours is a startup that provides pay for services rendered when people need it, instead of when the system decrees it’s time for them to get paid. By simply sending an image of their electronic timesheet, clients can get funds deposited into their bank accounts.  Then, when real payday comes, Active Hours is reimbursed from the customer’s account.

 

 

The company was started in 2007 by Ram Palaniappan, a business owner who realized his employees were being forced to pay late fees on bills because they had to wait for a set time to collect money they had already earned. Recognizing the folly behind forcing people to wait to gain access to money when they have already done the work for it, he set up a system that gave them the opportunity to access to the funds when they needed it. Then, rather than charge a set fee for the service, Active Hours allows customers to pay what they think the service is worth.

Although Active Hours was originally created for Palaniappan’s own business, the company has since grown and is offering its services nationwide. This is fantastic news for the millions of Americans saddled debt because their current payment scheme means they have to put basic needs on strained credit cards and end up in situations where—thanks to crushing interest rates and punitive late fees—they will likely never see the end of the debt tunnel.

The modern work world is often known as the rat race and, for many people, the current payment system is like running the race from the exercise wheel. Although they are constantly working, because of the combination of payment times and late fees, there is no chance of them ever getting ahead. Big Banking, run by the elite, has no desire to look at this issue. Were it left up to them, the system would never change. Luckily, however, we have FinTech and this new system is turning the banking status quo on its head.