By Christopher Maag
We’ve all received paychecks. How about a pay…card? The drugstore giant Rite Aid announced that it will offer its 91,000 employees the chance to receive their paychecks on prepaid debit cards.
“We think it’s good for our associates because we promote direct deposit,” Karen Rugen, the company’s lead spokeswoman, said in a phone interview. “And secondly, we have a lot of associates who don’t have a bank account, and this works as a debit card for them, and they can avoid check cashing fees.”
Prepaid debit cards are often targeted to people who don’t have bank accounts. The cards enable them to make online purchases, and in some cases come with paper or online statements that let them track their spending.
Corporate employees will get first crack at the cards in June. Workers in the company’s stores will get them in July, Rugen said. Employees can use the cards at Rite Aid stores, and take out cash for free using a network of 37,000 ATMs. Neither Rite Aid nor its employees will pay for the cards.
The cards will be printed and managed by Green Dot, a California-based prepaid debit card company. We asked Green Dot how it plans to make money from the system, but Liz Brady, a spokeswoman for the company, declined to comment.
Christopher Maag is a freelance journalist for publications including The New York Times, TIME magazine and Popular Mechanics. He graduated with honours from the Columbia University Graduate School of Journalism, and has worked as a staff writer for daily newspapers, monthly magazines, alt weeklies and websites. Maag writes about people with big dreams set on little stages, including a teenage girl who races jet-powered tractors, and people who make millions of dollars impersonating Barack Obama.