Paycheck-linked lending

From payday to payback. Instantly.

Capture repayment straight from paychecks with the industry's top performing direct deposit switch solution.

How Pay by Paycheck works

Borrowers set up in minutes and payments flow automatically from each paycheck, cutting risk for lenders and stress for borrowers.

1. PreMatch direct deposit switch

2. Pay by Paycheck activated

3. Automatic repayment

30% higher deposit conversion than any competitive solution.

Quotes

By integrating with Pinwheel, we are ensuring our users have the best possible experience when managing their direct deposits and finances.
— Dee Choubey, CEO & Co-Founder, MoneyLion

Pinwheel has been instrumental in enabling our pay-by-paycheck model to scale. Their technology gives us the real-time payroll connectivity we need to confirm paycheck routing and verify employment — all without burdening the customer.
— Andy Billingsley, Product Manager at Perpay

The modern infrastructure powering the future of lending

Enabled by industry-leading coverage & exclusive partnerships with prominent payroll providers - our suite of products makes a best-in-class Pay by Paycheck program easy to deploy.

Benefits:

• Reduce risk of fraud and eliminate manual errors at loan approval with real-time, source of truth payroll provider data.
• Prevent delinquencies before they happen with real-time monitoring of changes to income, employment status, or deposit allocation.

A win-win for lenders and borrowers

Lending

• Lower default risk by aligning repayment with payday.
• Reduce costs by eliminating operational overhead, ACH fees, and costly authentication expenses.
• Deliver an optimal borrower experience with industry-leading performance and coverage.

Borrowers

• Access lower rates and avoid late fees through consistent, on-time repayment with Pay by Paycheck.
• Automatic, paycheck-aligned payments reduce stress and give clearer visibility into discretionary income.
• Benefit from programs that report on-time payments to credit bureaus.

FAQs: Pinwheel Pay by Paycheck

What is Pinwheel Pay by Paycheck?

Pinwheel Pay by Paycheck is a payroll-linked repayment infrastructure product that enables lenders to collect loan repayments automatically, directly from a borrower's paycheck — on the day the paycheck is deposited.

How does Pay by Paycheck work for borrowers?

• Step 1: PreMatch Direct Deposit Switch
  At loan approval, the borrower routes a specified portion of their paycheck to the lender's account without needing to log in to their employer's payroll portal.
• Step 2: Pay by Paycheck Activated
  Once the direct deposit instruction is updated, Pay by Paycheck is live and monitored in real time.
• Step 3: Automatic Repayment
  On each pay date, the repayment amount flows directly to the lender.

What performance results do lenders see with Pay by Paycheck?

• 57% decrease in late payments among Pay by Paycheck users.
• 6% improvement in default rates for borrowers using Pinwheel Verify at origination.
• 30% higher deposit switch conversion compared to competitors.

Why is payroll-linked repayment better than ACH debit for lenders?

• Eliminates insufficient funds and processing delays.
• Reduces operational costs related to missed payments.

What is the benefit of Pay by Paycheck for borrowers?

• Lower rates and better terms due to reduced default risk.
• Automatic payments reduce stress and enhance budgeting clarity.

Which lender types are best suited for Pay by Paycheck?

• Consumer installment lenders and personal loan providers.
• Banks and credit unions serving near-prime and underserved borrowers.

How does Pay by Paycheck use Pinwheel Verify to reduce default risk at origination?

Pinwheel Verify provides real-time income and employment data, improving underwriting quality by reducing fraud and data errors.

What does implementation look like for a lender deploying Pay by Paycheck?

A lender is advised to integrate three Pinwheel components: Verify, Deposit Switch, and Connected Accounts for ongoing monitoring.

How is Pay by Paycheck different from earned wage access?

Pay by Paycheck is primarily a repayment product for lenders while Earned Wage Access allows employees to receive a portion of their already-earned wages before payday.