Plan to stamp out pay-day lenders

The man behind the four-day week trial is now backing another business which he hopes will help stamp out pay-day lenders.

Andrew Barnes, whose trustee company Perpetual Guardian, trialled paying staff for a full week for working four days, is the chair of PaySauce, a payroll service provider which hopes to launch a draw-down service.

For $3 each time, workers would be able to access their pay early without paying any interest or having to pay money back.

Barnes said PaySauce could help stop many Kiwis from turning to payday lenders, some of which charge as much as 700 per cent interest.

“Pay-day lending, is at its heart a grim thing because of the interest rates they charge.”

Founded in 2015 Paysauce has traditionally focused on the agricultural sector.

Barnes said it was developed to give farmers the ability to pay staff on an ad-hoc basis and now serviced around 10 per cent of dairy farms.

It then began to look around and join the dots about how the software could be used in other ways.

PaySauce now hopes to pilot the draw-down service from September 21 and is calling for small and medium sized businesses to get in touch.

The company hopes to be the first to offer the service in Australasia.

Barnes said one of the big issues Kiwis had was stress and money was a big source of that and could affect the productivity of workers.

“The employer doesn’t have to do this for everybody — only when an employee really needs it.”

PaySauce chief executive and cofounder Asantha Wijeyeratne said its service would allow workers to be paid any day they like allowing them to draw on funds as soon as they are earned.

“By doing so, we hope we can help prevent Kiwi workers needing to take ultra-high-interest loans to cover short funding gaps.”