Gusto Cash Advance – A Flexible Employee Benefit

Gusto Cash Advance is a flexible employee benefit that provides financial assistance to employees during times of need. It's designed to help employees cover unexpected expenses, such as medical bills or car repairs.

Gusto Cash Advance offers a range of benefits, including access to cash advances, flexible repayment terms, and no interest or fees. This means that employees can get the help they need without worrying about added costs.

The cash advance amount is determined by the employer, and it can be a one-time payment or a recurring benefit. This allows employers to tailor the benefit to their specific needs and budget.

Gusto offers a cash advance option through its Cashout feature, which allows employees to request an advance of up to 50% of their paycheck, up to $1,000.

This feature is designed to help employees who need their paycheck early, and the employer is not responsible for defaults on the debt.

The employee is limited to two advances per pay period, and the advance is limited to what Gusto estimates they have already earned that pay period.

The fee for this service is 1% of the transaction, which is much smaller than an overdraft fee, credit card late fee, or a payday loan.

You can also use Gusto's financing options to borrow cash against your shares, which can be a good alternative to selling your shares.

Secfi is one of the non-recourse financing providers that offers this type of financing, and it's designed to be company-friendly with no transfer of ownership of the shares.

The financing structure allows you to receive a cash advance today and only pay back the cash advance and associated fees after your company gets acquired or goes public.

This type of financing can be used for liquidity purposes, option exercise, or a combination of both, and you retain the ownership of your shares in the financing transaction.

Gusto offers a cash advance feature that allows employees to access a portion of their earned wages before payday.

This feature is designed to help employees manage their finances and avoid late fees or overdraft charges.

With Gusto, employees can access up to 50% of their earned wages, up to a maximum of $5,000.

The cash advance feature is available in Gusto's mobile app, making it easy for employees to request and receive funds on the go.

The funds are deposited directly into the employee's bank account, usually within 24 hours.

Gusto also offers a repayment feature that allows employees to repay the cash advance through payroll deductions.

This repayment feature helps employees avoid interest charges and fees associated with traditional payday loans.

The repayment feature is also flexible, allowing employees to choose the amount and frequency of their repayments.

By offering flexible payment features, Gusto helps employees take control of their finances and avoid debt.

Gusto has launched free earned wage access for employees of its small business clients, which gives employees access to their wages between paychecks.

This feature is a welcomed benefit for small business employees, as conventional short-term finance options are expensive.

Gusto aims to help small businesses manage all benefits for employees, and its existing product suite includes access to health and dental insurance, a digital wallet and debit card, payroll functions, as well as access to certified HR experts.

The fintech currently has 100,000 small business customers and is valued at $3.8 billion.

Gusto is already integrated into its clients' payroll systems for its existing services, streamlining employers' ability to offer earned wage access and letting employees easily access it.

Gusto doesn't charge employers extra to offer the product or require them to provide access to any additional employee information.

Existing users can start utilizing the feature without having to download an additional app, which could boost adoption.

The service gives employees a much-needed alternative to expensive conventional short-term financing options, such as payday loans that can charge interest of as much as 400%.

Here are some key benefits of Gusto's free earned wage access:

Nav and Gusto have joined forces to tackle cash flow challenges for small businesses. This partnership brings together Nav's financial health platform with Gusto's all-in-one platform for payroll, benefits, and HR.

Gusto serves over 300,000 businesses nationwide, processing tens of billions of dollars of payroll each year and providing employee benefits like health insurance and 401(k) plans. Nav's platform helps more than 2 million businesses improve borrowing power and access capital they need to thrive.

Small businesses often struggle with uneven cash flow, with 54% saying it's their biggest financial challenge, according to the Federal Reserve's 2023 report on Employer Firms. Managing cash flow can be a constant struggle for small business owners.

Through this partnership, Gusto customers will gain access to Nav's network of over 160 different financing options, including loans, credit cards, banking, and other business service options. This can help small businesses find available funding and improve the stability of their cash flow.