Employees Are Lending Their Employers Over $1.6 Billion Through Expenses Every Month (US)

Employees in the US are effectively lending their employers $1.6 billion a month through expenses, leading to a feeling they are at times acting as a bank to their own employer.

That is according to new research from Conferma, the fintech company specialising in virtual payment technology, which has identified that 38 percent of employees in the US use their own money to pay for work-related expenses at least once per month. The average individual expense claim is $110.90.

 The problem of reimbursement is a big issue for many, so much so that 45% percent experience personal cash flow issues because of their company’s expense submission deadline.

 Cash shortfall takes its toll on employee mental health

 With over a third (38 percent) of employees stating they had to wait up to or over 2 weeks to be paid back after submitting a claim, it is unsurprising that cashflow issues occur regularly. The majority (60 percent) of 18-34-year said they had less money to spend on personal items in the short-term, correlating with the fact that the average cost of work related expenses was highest among this age group (average monthly spend of $116.30).

 This is undoubtedly taking effect on employee mental wellbeing. Over half of employees in this age range (58 percent) admitted that the combination of these factors caused them stress and almost half of male of employees also cited regular stress (47 percent) because of the system.

 A detrimental impact on employer productivity

 The issue is as much of a concern for employers as well, with 49 percent of employees admitting they would stop spending money on a business expense if they had to wait a significant amount of time to be repaid. This could have a detrimental business impact through opportunities lost. For example, 1-in-5 said they would stop undertaking business travel and a shocking 51 percent prepared to halt meeting current or prospective customers and undertaking marketing activities altogether. 

 Commenting, Simon Barker, Co-Founder and CEO of Conferma, said: “The scale of this issue identified in these findings has taken us by surprise. We knew it was a problem, and one we are working hard to address, but the impact of this on both employees but also employers really is cause for concern.

 “It simply should not be the case in today’s world that individuals, particularly the low-paid, are having to hold back personal spending due to the delay in expense repayment. Likewise, it is staggering that a single business opportunity should be missed due to an employee’s decision to hold off marketing because of these inefficiencies.

 “This is a problem that is understandable in 1988 but not 2018. Businesses must do more to address this issue for their own benefit as well as the wellbeing of their own staff.”

 The full research report can be found here.



·         Fieldwork dates: 14-19 June 2018.

·         Sample: 1,001 U.S. adults (18+) currently in employment.

·         Sole traders and self-employed excluded.

·         This report is based on the results of an online survey.

 Calculation: America’s Invisible Bank

In order to put a figure on the amount of money ‘lent’ by employees to businesses through the time lag of expenses being incurred and reimbursed, we went through the following process. 

·         US working population employed by enterprises: 115,938,468 (US Census Bureau, 2015)

·         % of people who pay for expenses using personal means at least once per month: 38%

·         Average expense claim on a monthly basis: $110.90

·         Expenses repaid in less than a week but not immediate: 33%

o   $110.90 * ((44,436,618 x 33% = 14,664,084) / 4 = 3,666,021)) = $406,561,729

·         Expenses repaid in 1-2 weeks: 27%

o   $110.90 * (44,436,618  x 27% = 11,997,887) / 2 = 5,998,943)) = $665,282,826

·         Expenses repaid in more than 2 weeks: 11%

o   $110.90 * (44,436,618 x 11% = 4,888,028) / 1 = 4,888,028)) = $542,082,303

·         TOTAL: employee ‘lending’ to business of $1,613,927,900

About Conferma Pay

Conferma Pay is a global financial technology company. We design and integrate virtual payment systems that provides a more efficient, seamless and secure way to pay for for businesses.

Travel Meets Payment

Conferma Pay was born in Manchester in 2005. Since then we have connected over 700 TMCs, and directly integrate with all the major GDSs and OBTs. Our roots lie in corporate travel payment integration.

We enable our payment providers to flow virtual cards into the preferred purchasing process of any business travel buyer. Crucial to this is our network of banking partners, who have issued virtual cards in over 200 countries, in 40 currencies with over 45 commercial banking partners via all major card networks.

Our ecosystem continues to expand to meet the growing requirements of our global customer base.

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