Reducing Payroll Friction: How Instant Transfer Systems Benefit Distributed Teams

Need to pay distributed teams faster? Here’s how instant transfer systems can help.

Distributed teams offer countless benefits for growing companies… but handling payroll efficiently is a challenge.

Having employees and contractors working remotely across countries, time zones, and currencies creates payroll friction.

Slow bank transfers. Currency conversion. Cross-border fees.

Getting team members paid on time feels like a full-time job…

…but it doesn’t have to be with instant transfer systems.

Online money transfer services that support instant payouts solve most of the pain points associated with paying a distributed workforce. If your team needs to send money to Brazil with Pix, Southeast Asia, Europe, or virtually anywhere else… instant payments can streamline your cross-border payroll too.

Interested in learning how?

In this article:

1. Why Traditional Payroll Hurts Distributed Teams
2. Understanding the Cost of Payroll Friction
3. How Instant Transfer Systems Solve the Problem
4. How to Choose an Online Money Transfer Service

Ready? Let’s dive in.

Why Traditional Payroll Hurts Distributed Teams

Let’s start with the problems that distributed teams face when paying employees through traditional payroll systems.

Traditional payroll processes revolve around scheduling. You run payroll every week or two. Sometimes monthly.

The money goes through your bank and waits for processing. Then, hopefully, the employee gets paid.

This system works fine for employees all working under the same domestic bank. But once you start adding international team members in other countries… pay can get seriously delayed.

Here’s why:

Cross-border payments using traditional banks and transfers often take anywhere from 3-5 business days to process. Currency conversion, intermediary banks, and compliance checks add even more friction and wait time.

According to ADP’s global payroll survey, six in ten businesses stated payroll delivery times were affected due to staff shortages and manual processes.

Not only that…

Distributed teams often span dozens of countries each with their own tax systems, currencies, and banking rules.

LATAM teams alone need to manage payroll in 20+ countries. Europe + Africa = 50+ countries. Asia has upwards of 150.

That doesn’t even factor in currency conversion rates, domestic payments, and payroll schedules.

Needless to say… when a payroll run requires handling that many moving pieces across borders, payments can quickly fall behind.

Team members end up waiting days or weeks to receive their earnings.

And nobody wants to work for a company that doesn’t pay on time.

The Real Cost of Payroll Friction

Slow international payments are more than annoying. They also cost real money.

The fees associated with cross-border payments add up quickly. Globally, the average cost to send a remittance is around 6.35% per transaction. That’s according to the World Bank.

That may not seem like a lot until you realize that means services are literally taking nearly 10% of every payment you send as their cut.

Still thinking those fees are minimal? Consider what friction does to:

• Employee retention… Team members who don’t get paid on time will start looking elsewhere.
• Nobody is at their best when worrying about when they’ll receive their paycheck.
• Trust your team will do a good job. Pay them late and that trust goes out the window.

Payroll friction costs money and talented team members. A lot of them.

Many business owners don’t realize how big of an impact until they remove the pain points.

How Instant Transfer Systems Solve the Problem

If you’ve been wondering how to solve your payroll challenges, meet instant transfer systems.

Instead of sending money through domestic banks then waiting on a global network of intermediary banks to figure out where to send your transfer… instant platforms use locally routed payment networks.

Payments are sent through direct rails which enable transfer speeds of 1-5 minutes.

No more waiting days for contractors in Brazil to receive their pay. Philippines? Poland? Mexico?

The same speeds apply no matter where your teams are located.

Here are just a few of the ways instant transfers solve payroll friction for good.

Faster Payments

Team members are paid quickly. No more waiting weeks to receive a paycheck.

Platforms with instant transfer capabilities get money in team members’ hands within minutes.

Some companies offer “instant payroll” where team members get paid as soon as payroll is run.

Fees & Exchange Rates

Many payment networks pass on intermediary bank costs to clients.

While exact fees will vary by platform, look for low flat service fees and competitive exchange rates.

With Paysend, Brazil transfers with Pix are free. The markup on Euro (EUR) and Pound Sterling (GBP) exchange rates is 3.5%.

Paysend offers Australian Dollar (AUD), Canadian Dollar (CAD), Danish Krone (DKK), Hungarian Forint (HUF), Malaysian Ringgit (MYR), New Zealand Dollar (NZD), Singapore Dollar (SGD), Swedish Krona (SEK), and Thai Baht (THB) transfers that start at only £1.99.

These low fees allow companies to save money on every payment.

Transparent Fees

Stay in control of payouts with transparent fees.

This means no hidden charges. No surprises.

Before sending money, online money transfer services will show the exact exchange rate, fees, and what the payment recipient will receive.

Exactly how much gets paid. Exactly how much the team member gets.

Simplified, Global Payments

Instead of juggling multiple payment networks for different regions, languages, and currencies… instant transfer systems operate globally from a single dashboard.

Need to pay a global team in multiple currencies?

Look for a platform that supports transfers to dozens of countries using local currencies.

Paysend supports transfers to over 130 countries including all major currencies.

Suddenly going remote and hired contractors overseas?

Platforms like Paysend make it easy to pay globally. From U.S. dollars (USD) to Brazilian Real (BRL). You name it.

Don’t forget payroll season is right around the corner. Find a platform that allows seamless management of payouts across countries and currencies.

Adoption Is Accelerating

Want more proof that instant transfers are the future?

ADP found that over half of companies plan to implement nontraditional payment methods such as digital wallets or faster access to wages within 24 months.

That’s right… most businesses know there is a better way to handle payroll but haven’t made the leap just yet.

How to Choose an Online Money Transfer Service

As mentioned earlier, not all money transfer platforms are created equal.

When selecting a service to use for global payroll, consider the following criteria:

Coverage

Make sure the online payment provider supports every country your teams are located in.

Many online money platforms limit country coverage to 50-60 countries. Paysend supports payments to over 130 countries.

Speed

Look for services that provide instant payment capabilities.

If the platform doesn’t offer real-time transfers… it’s not going to solve your payroll friction problem.

Exchange Rates & Fees

Look beyond the advertised fees.

Some platforms advertise low fees but make up the difference with hidden exchange rates.

Before settling on a provider, ask for a quote or use the currency converter tool to see actual prices.

Integration

Modern platforms have built-in integration with payroll services and accounting software.

Having to enter payment info manually creates opportunity for human error. Focus on platforms that reduce the number of steps needed to send money.

Paysend has direct integrations with Travoro and TimeRegistration. The Paysend API also allows for custom integrations.

Compliance and Reporting

Payments across borders are heavily scrutinized. Compliance regulations require platforms to verify and report certain data points.

Compliant platforms will make this process seamless on the backend and provide reporting tools for your records.

Bottom line:

Picking the right online money transfer service should feel like… well… picking any other service your business uses.

If the process feels overly complicated. They’re probably not the right service for you.

Wrapping Up

Running payroll for domestic employees is stressful enough. Throw in international contractors in Brazil, India, China and more… and it can quickly become overwhelming.

Luckily, services like Paysend make it easier than ever to pay global teams quickly and securely.

With low transfer fees, instant payouts with Pix in Brazil, and global coverage for payouts around the world… Paysend takes the stress out of international payroll.

Payroll season is coming. Don’t wait until the last minute to find a solution that fits your team’s needs.

Find your solution today to learn how it can streamline your global payroll.