The cash economy is huge at $50 billion a year. But workers who get paid in cash often don’t or can’t use bank accounts to pay bills, save money, or even buy things with debit and credit cards.
A startup called Point of Wealth Systems, unveiling at this week’s DEMOfall 09, hopes to change that. The company will put its Point of Wealth Registers on site at companies where funds can be electronically allocated to bank accounts. Workers can use the money to make personal investments, pay bills, use prepaid Visa cards and other transactions that give them a financial benefit.
If it works, it allows workers who otherwise can’t earn returns on their cash to get the benefits that the rest of us take for granted. It’s truly staggering to think about how many people are paid in cash. Restaurant workers, for instance, are frequently paid in tips. The company says that there are 47 million “unbanked” or “under-banked” people in the U.S. Those people are paid $1 trillion a year in wages. That’s a lot of dollar bills floating around out there.
On stage, the company showed how easy it was to use the touchscreen kiosk to make utility payments, deposit money into retirement accounts, or even donate money to charity. You can do all of that within the course of a minute at a cost of about $1.50 per transaction. With each transaction, you put cash into the machine.
The Portland, Ore.-based company has raised funding from the founders, friends and family so far.http://c.brightcove.com/services/viewer/federated_f8/980795693
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