- New ethical payroll scheme allows employees to borrow and save money easily.
- Moneyworks Wales is a collaboration of 10 leading financial cooperatives and is supported by Welsh Government and TUC Wales.
- Businesses already offering Moneyworks Wales include Legal and General, Airbus and Admiral.
Moneyworks Wales, a new salary scheme launched this month, aims to help employees across Wales to build a better financial future. Supported by the Welsh Government, TUC Wales, the payroll scheme is a collaboration between 10 not-for-profit financial cooperatives and already has over 150 businesses across Wales on board including Legal & General, Admiral Insurance and Airbus.
Businesses, or payroll partners, that sign up for the scheme can offer employees the opportunity to borrow or save money directly through the payroll system. Much like national insurance or income tax, loan repayments and savings are moved directly from an employee’s salary before it reaches their bank account.
Encouraging employees to improve their financial wellbeing and providing the means to do so can positively impact the business itself. The CIPD found that one in four workers said that money worries had affected their ability to do their job. Businesses can evidently benefit by playing a role in encouraging their employees to prioritise their financial wellness.
The events of the past eighteen months have also highlighted the need for a financial safety net, with many finding themselves vulnerable to job losses or salary cuts. 16% of Welsh workers were employed in industries forced to close during the pandemic 1 and 17% of people in Wales said that the pandemic had caused problems for their household finances2.
However, financial worries are not a new concern for many in Wales. According to the Money Advice Service’s Wellbeing in Wales report in 20183 , 27% of adults had less than £100 in savings and investments and two thirds (66%) were not satisfied with their overall financial circumstances. A further 15% said they found keeping up with bills and credit commitments a significant burden.
Claire Savage, Policy Officer at Credit Unions of Wales said: “There has never been a more important time for businesses to support their employees with their finances. For many the pandemic brought with it a significant monetary shock and highlighted the importance of having a financial safety net. By equipping employees with the tools to become financially resilient, whether that’s through access to fair and ethical loans or a hassle-free savings product, employers are also building a happier and more productive workforce.
“We are so pleased to offer Moneyworks to the employers and employees of Wales. We’ve already had great feedback from our current partners and are looking forward to rolling out the product to more businesses large and small across Wales, helping their employees make money work for them.”
Jane Hutt, Minister for Social Justice, said: “The continued development of a strong credit union movement will provide access to fair, responsible and affordable credit for all across Wales. Many of us will need support at some time in our lives and the Moneyworks Wales payroll product will offer employees the help needed to make their money work for them and become more financially resilient, whilst slowly building a savings buffer. I strongly encourage employers to work with their local credit union to better support their staff financially, and beyond.”
Shavanah Taj, General Secretary Wales TUC, said: “Workers across Wales continue to face massive uncertainty as the economy recovers from Covid. So being able to easily put away some money from each pay packet and build some degree of financial security is more important than ever.
“Moneyworks is a win-win for employers and workers. Payroll savings schemes like these have been proven to be an effective and easy way for employers to support their workers and there are great, trade-union supported examples already across Wales. Growing that network further can help give workers a greater sense of control over their finances.”
Moneyworks Wales is designed to make saving and borrowing easier and fairer for all. For those that need extra help, employees can borrow anything from £100 to £15,000 via the scheme. Repayments are made directly from the person’s salary meaning they don’t have to remember or set money aside in order to make repayments, and interest is set at a fair rate and applied to the decreasing balance of the loan rather than the total borrowed.
For those employees wanting to increase their savings pots, whether that’s to ensure they have a rainy-day fund, or for specific goals such as home ownership, they can choose to save a set amount each month via their payroll. This means that the money is saved before reaching their own bank account, making it an easy and hassle-free way to put money away for the future. Savings are also guaranteed up to £85,000 under the Financial Services Compensation Scheme – just like with a bank or building society.
Lynne Sheehy MBE, Corporate Social Responsibility Manager, Legal & General said: “The launch of Moneyworks Wales couldn’t come at a better time for Welsh workers, supporting regular savings and access to affordable credit as a perk of employment.
“We at Legal & General have offered this opportunity to our team for a number of years and look forward to the added benefits for staff of this national initiative, including the interactive budgeting tools.”
 Welsh Government, 2020
 Welsh Government National Survey, 2020
 Money Advice Service’s Wellbeing in Wales report in 2018