Retailer’s Paycheck App Gets Mixed Reviews from Employees

Inside Subprime: Sept 11, 2018

By Jessica Easto

In December, Walmart launched an app designed to help employees better manage their finances, including providing access to portions of their paycheck in advance of their next payday. Eight months later, employees have mixed feelings about the app.

Employees’ concerns include a lack of clarity regarding the service’s rules. Emeraid Gems, a sales associate at a Walmart in Gettysburg, Pennsylvania, is among those confused by the app’s guidelines. According to a report in the Philadelphia Inquirer, Gems felt it wasn’t clear how to unsubscribe from the app and that it appeared she would be charged a monthly fee regardless of whether or not she used the app for a cash advance.

Gems was referring to the portion of the guidelines that states, “When you’re not using [the app] during a free month, the cost for you will be $6/month.”

Walmart told the Inquirer that Gems was mistaken and that she would only need to pay the fee if she wanted an advance and hadn’t earned a “free” month, one paid for by Walmart for every three months an employee has the app.

The lack of clarity was enough to dissuade Gems from trying the app, and she isn’t alone. According to an informal survey conducted by OUR Walmart, a group that organizes Walmart employees across the nation, many employees didn’t understand how to use the app or hadn’t heard of it.

As of July, only 200,000 of 1.5 million US Walmart employees use the app. Walmart is reportedly encouraged by these early results.

According to Daniel Eckert, senior vice president of Walmart Services and Digital Acceleration, the company has seen “an overwhelming response to it from our associates.”

It was also enough engagement to pique the interest of Silicon Valley, which resulted in a $40 million funding round led by venture capital firm Khosla Ventures.

Walmart, which has long been criticized for its low wages even among similar big box chains, intended for the app to help its employees avoid costly payday loans and financial scams. Many of the retailers’ employees, who make an average of $13.85 an hour at the full-time level, are among the 170 million Americans who live paycheck to paycheck.

Walmart is not the only employer to offer cash advances to its employees. Panda Express, McDonald’s, and Uber all offer instant-pay services for hours already worked.

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