The phrase “cash on the barrel head” means immediate payment, or “spot cash.” Well, employers are now providing Cash on the Barrel Head with payday apps that give employees instant access to their salary when earned, providing immediate liquidity and bypassing the need for credit cards and short-term, high interest rate loans. The app notifies the employee daily what they earned the previous day, and makes the funds immediately available.
The perk, which I believe is going to become increasingly commonplace, until now has been provided by retail, restaurant and service sector employers such as McDonald’s, Outback, and Bloomin’ Brands. The employers like it because it is cheap and appreciated by employees. The benefits and potential downsides are still being evaluated, according to a Wall Street Journal article this weekend.
On one hand it provides employees with the opportunity to better manage their money and avoid ramping up credit, but on the other hand it can become a daily liquidity fix that will compromise their ability to save. Whatever the result, this trend is here to stay, and is going to become a real game changer.