Zil Money Introduces Credit Card Payroll Payment Feature
The FinTech Zil Money is introducing a unique way for small businesses to fund their payroll.
About the feature:
Zil Money has announced the launch of its Payroll by Credit Card feature. As the name implies, this allows businesses to fund their payroll using a business credit card. In turn, business owners can earn rewards while streamlining their payroll. Additionally, this method could help with cash flow.
According to Zil, the company’s application integrates with a number of payroll company platforms, including ADP Workforce, Gusto, Paychex, UKG Pro, and more. Alternatively, businesses can create their own manual payroll system.
When setting up their account, businesses will link both a credit card and a bank account. Then, they can select whether to charge the entirety of payroll to the card or set a partial charge. Businesses can also elect to decide the split each time instead of setting a default. Zil will fund the business owner’s bank account using the credit card and then execute payroll from there.
According to their site, there’s a 2.95% processing fee for this feature. Meanwhile, beyond payroll, Zil Money also offers features that allow businesses to pay vendors, landlords, and other expenses using a credit card.
What they’re saying:
Announcing the idea behind this feature Zil Money founder Sabeer Nelli said, “Small businesses are often faced with an uphill battle when it comes to maintaining timely payroll due to cash flow issues. Our new feature enables small businesses to make payments via credit card but also effectively eliminates delayed payments and helps maintain a healthy cash flow.” Nelli added, “We aim to be the go-to payment solution for all small businesses. We’re dedicated to using fintech to change how these businesses handle their finances completely.”
As a fan of credit card rewards, part of me is in favor of any service that allows you to use your card for purchases that would otherwise not be possible — and, in turn, help you rack up points/miles/cashback. That said, I do have some key concerns about this Zil feature. For one, the press release refers to the 2.95% processing fee as a “nominal fee” and notes that business owners can write this off as an expense. However, that fee (even if written off) would likely outweigh any reward benefits business owners would see from their credit cards. On top of that, the idea of funding payroll via a credit card definitely sounds like a “last resort” option and not something that sounds like a good idea long term.
My issues aside, it does sound like an interesting feature. So, if you think your business could benefit, perhaps it’s worth checking out Zil Money.