Salary advance allows employees to access a portion of their already earned salary before payday, without loans, interest, or fees. With Salary advance settings, HR teams can configure how this benefit works in the company, ensuring it aligns with payroll processes and internal policies.
In this article, you’ll learn how Salary advance works, what rules you can configure, and what happens throughout the payroll cycle.
Learn more about Salary advance in this article.
How to use
- In your sidebar, go to Settings
- In the Finance section, access Salary advance
- There, you will find:
- Service activation
- Maximum over periodic salary
- Cycle closure date
- Accrual calculation method
- Auto-pay advances
Make sure you check the Salary advance permissions.
Service activation
Enable or disable access to this service for your employees. If the service is off, request submissions are disabled until you switch it back on.
There is no action required from employees to activate their account: admins enable Salary advance for the company. Once enabled, the feature automatically appears in the employee’s Factorial mobile app.
To ensure eligibility, confirm that the employee has:
- Valid employment contract information in Factorial (including gross salary)
- A valid IBAN configured in their profile
Once these conditions are met, the employee becomes eligible automatically. If an employee cannot see it, check their enrollment status.
Maximum over periodic salary
Limit early salary access to a percentage of the periodic salary. Set the maximum percentage employees can request (for example: 80%, 90%, or 100%).
Available funds increase daily as salaries accrue, but stop once this limit is reached.
This ensures employees retain part of their salary for regular payroll.
Important: At the moment, the cycle closure date is fixed. This standard date has been defined to prevent compensation discrepancies. If a client needs to modify it, they should first confirm with their Account Manager. Our team will then manage the change internally, as a reconciliation check is usually required before applying any adjustments.
Cycle closure date
Set the cycle closing date. The deadline is the last day you can request an advance each cycle. After this date, the system won't accept new requests until the next cycle begins and any request submitted after the deadline will be automatically rejected.
Why does this exist? Your payroll team needs time to close the books and process everything. The deadline gives them the buffer they need.
Tip: Check your Salary advance dashboard to see your company's specific deadline, it's usually around day 19-25 of the month.
What happens at cycle close?
At the end of each payroll cycle, the system automatically:
- Expires any pending requests that were not executed
- Resets all available balances to zero
- Includes all paid advances in the payroll deduction report
- Starts a new cycle
This ensures payroll remains clean and aligned with Salary Advance activity.
Important: At the moment, the cycle closure date is fixed. This standard date has been defined to prevent compensation discrepancies. If a client needs to modify it, they should first confirm with their Account Manager. Our team will then manage the change internally, as a reconciliation check is usually required before applying any adjustments.
Accrual calculation method
Choose how earned wages are calculated for hourly hours.There are two options:
- Calendar-based accrual
- Connected to Time tracking
All contract types use a calendar-based estimate of earned salary.
Auto-pay advances
You have the option to automatically set to pay requested advances from the selected payment account
What happens when the Contract type changes
If an employee changes contract type (for example, from hourly to monthly or vice versa):
- The calculation method updates automatically at the start of the next cycle
- Pending requests continue using the original calculation method
- New requests use the updated method
No manual action is required from HR.
Tips and best practices
- Set a percentage cap below 100% to ensure employees always receive part of their salary on payday
- Align the cycle closure date with your internal payroll calendar
- Regularly review payroll deduction reports to ensure visibility and transparency
- Communicate clearly to employees that Salary Advance is not a loan, but early access to earned salary