Direct Deposit

Direct deposit is the electronic transfer of an employee's net pay directly into their bank account on payday. Direct deposit is the most common method of paying employees in the United States, used by over 93% of U.S. workers according to the American Payroll Association.

From the employer's perspective, direct deposit eliminates the cost and administrative burden of printing and distributing paper checks, reduces the risk of lost or stolen checks, and ensures consistent, on-time payment regardless of holidays or mail delays.

Most states allow employers to require direct deposit, though some states require employers to offer an alternative payment method. Employees must provide a voided check or bank account information to set up direct deposit.