HONG LEONG Bank launched the HLB Salary Advance Employer Solution in partnership with Paywatch Malaysia Sdn Bhd – making it the first bank in South-East Asia to back an earned wage access (EWA) solution.
This EWA solution aims to empower Malaysians by providing them with easy access to their earned salaries, and is set to transform the way businesses offer and manage their advanced salary payouts.
The HLB Salary Advance Employer Solution is a simple, seamless digital platform that enables employees to withdraw up to 25% of their monthly earned salaries, whenever the need arises.
There are no interest or late charges, except for a nominal service fee of RM2 per withdrawal.
A recent survey conducted by the bank which involved 420 Malaysian employees and employers found that respondents desire easy access to their wages and better financial control, particularly in times of emergency.
The survey revealed that employees often feel uncomfortable requesting a salary advance from their employers.
On the other hand, employers ranked the ability to support their employees with flexible and quick access to their salaries during emergencies as a top priority in salary management.
Employers cited other benefits of a fully-automated EWA solution, such as improving cash flow management, reducing paperwork, and increasing employee satisfaction.
HLB personal financial services managing director Andrew Jong shared that the solution not only bridges the gaps and addresses the pain points in the current conventional salary advances, but also fosters financial flexibility, improves financial literacy and promotes financial inclusion for Malaysians.
“The rising costs of living and inflation increase the financial pressure on particularly the lower- to middle-income earners and households.
“In such circumstances, the payroll timings and conventional salary advance methods may not be able to provide timely assistance to meet cashflows and unexpected demands.
“This may leave individuals vulnerable to unsustainable borrowing practices.
“By offering real-time access to their own earned wages, this solution can help employees to tap into their earned but yet-to-be-paid wages and improve their control over their own finances, overcome short-term financial challenges, and improve their overall financial well-being.
“To further improve financial awareness and responsibility, users will also need to consider that they can meet their month-end financial commitments prior to requesting a salary advance,” he said.
Jong emphasised that the new EWA solution would help employers and businesses manage their advanced salary payouts – providing a fully-automated system that is streamlined, efficient and sustainable.
“Having a fully-digital, systemised EWA solution will help businesses manage their cash flow, streamline salary advance management, and reduce dependence on paperwork and manpower,” he added.
On partnering with HLB to roll out this new solution in Malaysia, Paywatch founder and chief executive officer Richard Kim said: “As a social impact platform, we work with employers and reputable financial institutions to produce a positive, sustainable impact on the financial health of employees across Asia.
“We partner with leading banks across different regions, including Hana Bank in South Korea, to ensure fair pricing, consumer protection and greater financial access to all.
“With HLB’s backing, our solution would more efficiently support employees’ financial security and resilience while providing companies with opportunities to offer enhanced benefits, thereby improving employee motivation and overall productivity.
“By providing employees with timely access to their earned wages, we are improving not only their financial well-being but also helping businesses retain their valuable talent.
“Our solution has been proven to decrease turnover rates and save companies an annual savings of over RM2.1mil (US$500,000) in rehiring fees.
“Paywatch empowers companies to demonstrate their commitment to their employees’ financial wellness, which in turn fosters a more loyal and engaged workforce,” Kim added.
To access this solution, employees from participating organisations can create an account on the Paywatch app.
Once approved, salary advance requests will be credited to the user’s bank account within one business day.
On payday, the advanced amount withdrawn will be automatically deducted from the employee’s salary.
On the employers’ end, the solution is designed to be seamless, secure, and convenient. There is no cash flow impact, no deposit required, and no integration with any company software.
To learn more about HLB Salary Advance Employer Solution, go to www.hlb.com.my/salaryadvance
