Gig economy workers and freelancers make up an increasingly larger percentage of today’s workforce. But when it comes to getting paid, a new survey from Bill.com says 54% of them feel it takes too long.
Freelancers Are Not Being Paid Fast Enough
The freelance workforce is a connected demographic using digital technology to work, play, shop and carryout financial transactions. And the survey says they are great supporters of digital payments.
More than four in five or 86% say they prefer to receive payments electronically, while 41% say they require electronic payments to avoid lateness.
For gig economy workers and freelancers — both technically operating as small businesses — getting paid on time is a big is
When a client doesn’t pay on time, it makes it hard for these small business owners to pay their own bills. Additionally, they must put more effort into trying to get paid, requiring time and resources they can’t afford.
Liz Steblay, founder and CEO of the Professional Independent Consultants of America, explains these challenges in a press release announcing the survey results. Steblay says all small businesses struggle with cash flow — including self-employed professionals in the gig-economy.
When these freelancers work for large companies, getting paid right away is not an option because of the payment structure these businesses have in place.
Steblay adds, “Most corporations have payment terms of 45 days or even 60, which is brutal when you’re self-employed. To add insult to injury, it’s surprising how many clients still pay by hard-copy check which can easily add another week to the payment process. With more and more professionals becoming self-employed, the companies that offer faster, more reliable payments will win the best talent.”
Bill.com carried out the survey with the participation of 1,400 U.S. freelancers and contractors. And although they are working in a digital ecosystem, more than 50% are still getting paid by check.
As mentioned above, 54% say it takes too long to get paid, with another 45% stating their clients don’t pay them on time. And when they do get paid, close to a third or 30% have to deal with payment processing fees.
Benefits of Digital Payments
Digital payment systems benefit both freelancers and clients, the survey says. For example, 81% of respondents say customers who use electronic payment systems usually pay on time. Of those who get paid digitally, 63% say they feel more valued when they receive electronic payments.
Qualified professionals and those with expertise in their field almost exclusively require electronic payments. Some even require upfront credit card information and charge late fees.
In the release, René Lacerte, founder and CEO of Bill.com, points to the growing impact of the freelance workforce on the economy and the benefits digital payment offer. Lacerte adds, “The gig workforce and their influence is poised to continue to grow each year as companies look to expand their workforce and Americans embrace a more flexible lifestyle. Digital payments not only meet the needs of both parties, but they do it quickly and with less hassle.”