- Company will provide employees of partnered employers with up to a $50 bonus for contributing to high-interest savings account
Salary Finance, the leading provider of socially responsible financial products for American workers, announced an ambitious new product that aims to help millions of U.S. workers save more money. In partnership with financial technology company Chime, Save from Salary Finance will enable US workers who are employed by Salary Finance’s employer partners to open a Chime spending account and high-interest Chime savings account, connect their direct deposit, and get rewarded for saving. Salary Finance will also uniquely pay workers to build their savings.
Not enough people are saving money: according to recent Salary Finance data, nearly 70 percent of employees don’t have savings set aside for emergencies and unexpected expenses. A lack of savings can often lead people to rely on high-cost borrowing options, like payday loans or high-interest credit cards, when unexpected expenses or income disruptions occur. This can lead to a treadmill of seemingly never-ending debt repayments. However, while saving is hard – especially during a global pandemic – a recent survey from Commonwealth showed that those who had a savings buffer were better able to weather the pandemic.
“We are on a mission at Salary Finance to ensure millions of American workers are able to easily build savings from their paycheck,” Dan Macklin, Chief Executive Officer, Salary Finance Inc, said. “Save is designed to incentivize working Americans to set up a savings account, link it to their salary, and benefit from a $50 bonus, with the aim of helping all employees build up to at least $500 in emergency savings. We are committed to continuing to develop impactful financial benefits that help Americans thrive.”
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In addition to the bonus from Salary Finance, when employees open a Chime savings account by leveraging Save, they get 0.50% Annual Percentage Yield (APY) – 10 times higher than the national average – on their savings balances with no hidden fees and no minimum balance requirement2. Employees can set their Chime account up so that money automatically moves from salary to savings every pay period. Chime also offers users a fee-free overdraft feature called SpotMe, early access to direct deposits, and a “save while you spend” feature to round up spending into savings.
It’s historically been hard for businesses to get comfortable addressing the personal finances of their employees. The ice on the relationship between business and employee has started to thaw – 75 percent of employees trust their employer when it comes to their personal finances – providing an opening for businesses to have that discussion with workers. By offering Save, employers can build trust and good will by providing employees with a better way to save money in case of emergencies or unexpected income disruptions.
Salary Finance launched Borrow, its low-interest employee loan product, three years ago in the U.S. Earlier this year, Community Investment Management (CIM) committed $150 million of debt funding over the next three years to help working Americans struggling with financial stress access affordable credit.
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The Annual Percentage Yield (“APY”) for the Chime Savings Account is variable and may change at any time. The disclosed APY is effective as of June 28, 2021. No minimum balance required. Must have $0.01 in savings to earn interest.
The average national savings account interest rate of 0.05% is determined by FDIC as of November 30, 2020 based on a simple average of rates paid (uses annual percentage yield) by all insured depository institutions and branches for which data are available.
Save When I Get Paid, if enabled, automatically transfers 10% of your direct deposits of $500 or more from your Spending Account into your savings account.
Chime SpotMe is an optional, no fee service that requires $500 in qualifying direct deposits to the Chime Spending Account each month. All qualifying members will be allowed to overdraw their account up to $20 on debit card purchases initially but may be later eligible for a higher limit of up to $200 or more based on member’s Chime Account history, direct deposit frequency and amount, spending activity and other risk-based factors. Your limit will be displayed to you within the Chime mobile app. You will receive notice of any changes to your limit. Your limit may change at any time, at Chime’s discretion. SpotMe won’t cover non-debit card purchases, including ATM withdrawals, ACH transfers, Pay Friends transfers, or Chime Checkbook transactions. See terms and conditions.
Early access to direct deposit funds depends on the timing of the submission of the payment file from the payer. We generally make these funds available on the day the payment file is received, which may be up to 2 days earlier than the scheduled payment date.
Round Ups automatically round up debit card purchases to the nearest dollar and transfers the round up from your Chime Spending Account to into your savings account.
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