How funds move through Palolo
As a manager or business owner, you're already familiar with direct deposit, a method of depositing payment (such as a paycheck) into a recipient's bank account. When using direct deposit, money is transferred electronically through the Automated Clearing House (ACH).
When an employee connects their paycheck to Palolo, they agree to route their direct deposit to Palolo before receiving their pay. This lets them build savings from their paycheck, access their pay early or apply for an advance, and make automatic repayments.
When it's time for payday, Palolo handles all Perk allocations before instantly transferring the employee's paycheck to their bank account.
Behind the scenes
Each participating employee’s direct deposit is routed through an individual clearing account in Palolo.
Palolo automatically repays Perks and allocates savings, then sends the direct deposit to the employee’s bank via ACH transfer. This takes about 1 minute.
Checking accounts are provided by Lewis & Clark Bank, Member FDIC. Funds deposited into Checking will be eligible for up to $250,000 of FDIC insurance.
How does this affect paycheck timing?
When an employee receives their paycheck depends on ACH schedules and the employee’s bank.
Transactions between banks are processed by the Automated Clearing House in batches throughout the day. This means that even though Palolo’s transfer is instant, it may not be processed for several hours, or in some cases, the next business day.
Furthermore, depending on the employee’s bank, it can take extra time before the employee sees their direct deposit in their account. Some banks may take longer than others to clear deposits and make funds available for use.