Payments

Workforce OS: A Payments Tour de Force

A recent study reveals the most pressing challenges in international workforce payment and management. Papaya Global's payroll & payments platform addresses them all

Table of contents

Key Takeaways

  1. According to a survey of 250 US- and UK-based executives, 80% of organizations experience challenges when paying or managing overseas workers.
  2. 93% of the companies facing 4 to 6 challenges when managing overseas workers are interested in innovative methods to pay those workers.
  3. With its groundbreaking unified global payroll and payments platform, Papaya Global offers the most innovative workforce tech on the market.

In 2018, streaming giant Spotify opened its podcasting section to allow anyone to upload podcasts to the platform. In the following years, the Swedish company asserted itself as a key player in the podcasting space, spending more than $1 billion on technology acquisitions, celebrity partnerships, and numerous content deals.

Spotify’s next move was to launch its audiobook business in late 2022. It was a natural next step for CEO Daniel Ek, who had realized that “audio — not just music — would be the future of Spotify.” The coming decade, Ek predicted, “will be defined by a more personalized, immersive audio experience.” In other words, the experience needs to be unified.

In recent years, the need for unification has been evident in many spaces, most notably global workforce payments. While payroll technologies have been adopted to manage global workforces, workforce payments are still outsourced to payment service providers (PSPs), as payroll companies typically don’t have payment capabilities.

The split between payroll and payments causes unnecessary friction and is overall undesirable. A recent study by PYMNTS, Meeting The Demand For Cross-Border Hiring: Challenges In International Workforce Payment And Management, explored how these challenges affect organizations’ attitudes toward paying and managing their workers. The findings were telling:

  • 80% of organizations said they experienced challenges when paying or managing overseas workers.
  • When asked to cite specific challenges in managing international workers, paying a cross-border workforce was listed as the second most important challenge.
  • 93% of the companies facing 4 to 6 challenges when managing overseas workers are interested in innovative methods to pay those workers.

A break with tradition

The most innovative method on the market is Papaya Global’s operating system, Papaya OS, the only payroll and payments platform designed for global workforces. It starts with infrastructure. Payment service providers deliver workforce payments via traditional payment rails, leading to slower processing times and often resulting in late payments. Papaya Global took a different route.

Relying on partnerships with tier-1 banks such as J.P. Morgan Chase, Papaya built the world’s first workforce-dedicated rails to ensure fast payments. In addition, Papaya’s tech shifts the focus from “send date” (the date the money enters the payment rails) to “land date” (the date the money must arrive in the worker’s account), takes care of the reverse calculations, accounts for possible delays, and delivers every payment on time – every time.

Paying via Papaya OS is not only fast and timely but also accurate. While traditional rails are littered with intermediary banks – each of which charges a processing fee deducted from the employee’s salary – on Papaya’s workforce-dedicated rails, all fees are known in advance. This allows us to guarantee full value transfer, meaning your workers receive every cent they are entitled to.

It doesn’t end there. When payroll and payments are unified under one operating system, workforce payments are always accurately marked on arrival, allowing banks to classify them as salaries. The salaries are attributed to the ultimate debtor – the employer. In other words, your workers will see your company as the paying entity, not Papaya Global, an intermediary bank, or any other third-party payment provider.

Rake in the cash

Most third-party payment providers require that payroll funds be locked up well before payday, typically with a 30% buffer to account for exchange rate fluctuations. This increased exposure to currency fluctuations creates difficulties with cash flow management – the second most cited challenge by the 250 US- and UK-based organizations surveyed in PYMNTS’ study.

Papaya OS addresses this challenge in two ways. First, our dedicated rails guarantee payment delivery within 72 hours, allowing clients to fund their workforce wallet much later in the pay cycle. Second, our AI-powered transfer processing algorithm accounts for exchange rate fluctuations as late as possible in the payment process, reducing currency conversion costs to a minimum and providing cash flow flexibility.

The most pressing challenge in paying international workers, according to PYMNTS’ study, is the need to comply with jurisdictional regulations. This is where Papaya’s compliance engine comes in. With local labor laws, tax codes, and benefits regulations in more than 160 jurisdictions baked into it, this automated feature can detect any compliance gap and alert payroll managers in time, eliminating the risk of fines and potential employee litigation.

Naturally, Papaya’s unwavering commitment to compliance extends to payments as well. As a regulated financial services company, Papaya holds money transfer licenses across the globe, enabling compliant workforce payments everywhere. In addition, we perform Know Your Customer (KYC) and Anti-Money Laundering (AML) processes for each new client and worker being paid through our platform.

Because our clients and the workers paid through our platform – just like Spotify’s listeners – deserve a unified experience. Streamlining your global payments and payroll starts here.