Programming Money: Equity and Access to Funds in Organizations
When I think about how employees use money at organizations I start by thinking about the financial ecosystem of the organization. What are the ways in which money is moving across time, rank, geography, and types of individuals(volunteers, contractors, etc) involved in the organization? The second question is, what are ways in which organizations can distribute money instantly, securely, and in a compliant manner in a distributed way?
Unfortunately many nonprofits and businesses offer outdated solutions including mail-in reimbursement, expensive and complicated expense reports, and often big delays between the need and use of money. Nonprofits themselves have rarely been on the cutting edge-even though they work with communities who often lack access to traditional banking- primarily due to lack of funds, compliance, or general know-how. We've seen situations that require the mass movement of money to folks. Stimulus checks for example highlighted the challenges in adopting a digital, distributed financial model amidst COVID. It also allows for organizations to adopt faster to a new reality,
One of the first issues is establishing the ease and access of money, while maintaining governance issues like compliance requirements, budgetary allocations, and internal controls. . In a distributed, fast-paced organization money should be able to be issued or programmed as soon as the money is approved for use. I've found three use cases to look at in nonprofits to begin to modernize their financial infrastructure, ensure equity in access to funds, and meet needs of folks on the ground.
1. Access to goods and services in an organization. Things like flights, car rentals, digital subscriptions, etc can often be purchased centrally and used in a decentralized fashion. Features like dynamic internal controls at TripActions, digital mass Pre-Pay options like Uber Vouchers, and Lyft Events, allow for folks to use systems they already use for digital or distributed events while having the back end directory of trips taken or vouchers used. In this category money doesn't need to be created or programmed but instead uses the infrastructure of the vendor to remit these credits. This creates significantly less backend work and reduces reimbursements.
2. Access to larger amounts of organizational monies.
I've found cashflow to be the biggest barrier beyond a budget issue in getting money to folks. Card Programs like Emburse through Abacus allow budgets to be mapped on to employees through expense management and the creation of digital and physical prepaid cards, essentially programming money to employees . By allowing internal controls like dates of use, weekly budget restrictions, and on the fly activation into Apple or Samsung pay, organizations are able to meet the financial needs of employees through digital retreats, last minute travel changes, and emergency situations.
3. The third is Accounts Payable and Payroll. Besides traditional payroll and banking systems, programs like Checkbook and DailyPay allow for instant disbursement to a distributed network of contractors and even employees. They are especially useful in pay
ing part-time workers instantly, and provide financial education to folks as well. Some also use data to help predict and determine how people like to be paid.
As organizations become remote and distributed, people need access to financial solutions that match their lives. Th
e personalization of financial systems should also extend to organizations so money is moved in a way that supports people, has internal controls, and reduces work for the organization.