Uber introduces instant-pay for San Francisco drivers
Uber continues its foray into finance with a real-time pay option for partner drivers
Global ride-sharing platform Uber's latest partnership will see its drivers in San Francisco offered a free debit card to access their pay instantly. In both the US and Australia Uber has partnered with car lenders and financiers to help its driver partners buy or rent vehicles, but this latest venture will help drivers get their pay in real-time using their cards.
The instant-pay option is open to drivers in San Francisco over the age of 18. There is also no credit check required. The debit card and account are opened through GoBank, and while it comes with an $US8.95 monthly fee, this can be avoided by direct depositing at least $US500 earnings from Uber into the card account monthly.
In both Australia and the US, driver partners are paid weekly. While this isn't a long stretch between pay dates, drivers have regular ongoing expenses such as petrol and car cleaning to manage, not to mention the threat of car breakdowns or urgent repairs. Having an option to access up-to-date pay may prove to be a lure for drivers.
Uber drivers work irregular hours and are self-employed, so accessing finance to cover gaps in pay may prove challenging. This may be why driver partners have been targeted by third-party finance providers and lenders.
One third-party service on offer is Clearbanc, allowing Uber drivers to get an advance on their pay – similar to Uber's latest offering. By paying $2 a day to Clearbanc, US partner drivers essentially get their own bank account and debit card through which they can advance their Uber pay. The service is currently operating without the endorsement of Uber. A quick search through Uber driver forums also shows the prevalence of payday lending in the space.
Uber's auto loan program has also previously come under fire in the US for targeting subprime borrowers. Uber offered loans and lease agreements through financing companies including Santander, General Motors and Toyota Finance to borrowers with all levels of credit. However, many of the agreements were restrictive and costly. For instance, some cars under the lease agreements could not be driven for personal use.
Having an option to access instant pay is a potential win for driver partners anywhere it's introduced, with it offering a way to work with the flexibility demanded of them. Local driver partners will have to wait to see if the same option will be introduced in Australia.