Comparing Stipend Software: Everything You Need to Know

Below we highlight everything you need to consider to select the best stipend management software for your company and employees.


There are countless employee stipend management tools and software entering the market with all different approaches. This can make knowing the perfect vendor to select a more challenging process.

This post will guide you to make the right decision for your business and employee needs.

Read on to learn more about:


Why transition to stipend management software?

You might be wondering why people are ditching the traditional types of perks and moving to stipend management software. 

Every software is different, but below are eleven a few of the significant benefits you can expect from using a perk management software:

✔️ Relevant for right now and the future

Employee stipends can evolve to meet your team's needs, but only if they're personalized. Using a stipend management platform allows you to tailor your fringe benefits to meet current budgets as well as the wants and needs of the people in your organization.

✔️ Personalized and inclusive

Gone are the days of one-size-fits-all perks like on-site gyms, catered meals, or hand-picked meditation apps. Today’s workforce is multicultural, multi-generational, and multi-location and so personalized perks are inclusive because they make it easy for your employees to get the lifestyle benefits they prefer.

✔️ Increased engagement rates with company perks 

Instead of an intranet page full of logos and potential vendors (which can be overwhelming), a stipend approach simplifies the process and lets employees get what they truly need. 

✔️ Competitive advantage

Many large companies have extensive benefit packages (again, with lots of logos & processes to navigate), but this allows companies of any size to compete for the same talent successfully. 

✔️ Automated processes

The ongoing administrative process of stipends is simpler and takes less time. HR can get behind software that reduces their administrative burden and makes them look brilliant at the same time.

✔️ All-in-one or supplemental perks

With these software options, you can either turn it into your entire perk offering or use it as a supplemental add-on to what you’re already doing to add personalization and inclusivity.

✔️ Flexible for HR

Perk stipend programs are easy to update for your entire company all at once. Much easier than removing a culture-related perk like 'Bagel Fridays' even if engagement is way down.

✔️ Scalable perks

Regardless of whether you’re scaling up or down, a stipend software can help you do it with ease.

✔️ Aligns with company values/goals

What does your company want to reinforce behavior around -- maybe it’s learning or health, whatever it might be, a stipend reimbursement software can help you create perk programs that align.

✔️ Little to zero waste

With stipends reimbursement models, you’ll decrease the budget waste on unused perks, and save time time spent picking rarely used perks, and reduce the hassle of managing them all.


Stipend management tools, vendors, and software

In alphabetical order, the following perk software you may want to look into are the following:

Keep in mind, this approach is different than the legacy approach of corporate discounts like you’ll see with Fond or Reward Gateway or social and recognition software like Rewardian or Achievers.


Top 5 criteria to consider when buying a stipend software solution

1. Price 

We put price first on the list because everyone has a budget, and making sure to stick within the confines of it is essential to getting stakeholder buy-in for a new tool.

Most HR tech benefit software can cost anywhere between $1 - $8 per employee and include an implementation fee -- stipend management tools aren’t any different.  

With these types of software, there’s an additional amount you pay, which is how much you’d like to allocate to each team member per period (monthly, quarterly, semi-annually, or annually).

For example, instead of bringing in catered lunches, you could give each employee $100/month to spend on their lunch of choice. 

Questions to consider:

  • What budget were you spending on on-site perks that you can transition to a perk stipend or debit card?
  • What perks and benefits can you consolidate and filter through this program to save you money/time? For example, instead of paying for gym memberships, meditation apps like Calm/Headspace, and book programs (which can be a challenging process to manage manually), turn them into a perks stipend or perks program through one of these vendors, reducing the multiple various logins, manually process, and price-points for each employee -- all three which save money or time (which is a hidden form of money savings).
  • What tools (e.g., calculators) are available by the vendors that can help you track your cost increase as your head-count increases or decreases.
  • Are there any software discounts?

[We also talk at length about the budget side for software and your stipend in our post, how to set up your employee stipend].

2. How much administrative time & effort is needed

A big reason to buy software is to automate and streamline the administrative processes that might be weighing down your team and its operational capacity.

As we've already noted, the more disparate perks you offer, the more significant the administrative burden.  There's often a tipping point for organizations when it's too much work to manage everything and be forced to consolidate or remove underutilized perks.

The key is to pick software that can manage the personalization complexity without adding too much additional work for you. 

Questions to consider:

  • How much time does it currently take to manage your current perk processes? Some items to account for are picking, piloting, purchasing, launching, communicating, & upkeep.
  • How much time could we save with a new process, and how many dollars would that save the organization?
  • What strategic projects could you tackle if you didn't have to manage your perks or stipends?

3. Typical engagement rates

We know what you’re thinking, if you’re going to take the time to roll something out to your people, you want to make sure it’s something they’re going to absolutely love. And how love translates into a metric, is usage or engagement rates. 

A stipend management approach generally sees higher usage rates. Unlike individual perk vendors like meditation apps, onsite/virtual yoga, and dry-cleaning, which only satisfy a small percentage of your people, they allow you to offer something for everyone. 

When connecting with vendors, ask them what typical engagement rates are to get an idea of which ones people are engaging with.

Questions to consider:

  • What are your current engagement rates with benefits, perks, or stipends?
  • What would increasing engagement rates mean for your business and people?
  • If you’re a larger organization, what might be an excellent team to pilot the software first to determine if it’s worthy of rolling out company-wide?

4. IRS Compliance 

While this should be a significant factor in every company’s decision, if you are larger than 50 employees or have a CFO, you will likely focus on it keenly.

Most of the perks you could offer your employees (from food to yoga to pet insurance) are taxable income for your employees. The IRS is pretty clear in its guidance as to which benefits are taxable and which aren’t. What this means for you is that as you consider increasing or changing your team’s perks, you also need to consider how you are going to track and manage those tax requirements.   

Questions to consider:

  • If we have to manage the IRS compliance on your end, what will that process look like?
  • If you aren’t tax compliant now, how will that impact your ability to grow as a company and how would that impact your ability to pass an audit or raise future capital? 
  • What does your CFO/Finance team think about the software options available?

5. Implementation timeline

Considering the implementation timeline is crucial when evaluating a stipend platform for several reasons.

Firstly, the length of the implementation timeline will determine how quickly you will receive a return on investment. A shorter one allows an organization to start reaping the benefits of their stipend program sooner.

Secondly, the implementation timeline and process reflects the vendor's expertise and commitment to customer satisfaction, which can indicate a smoother transition for you and your employees, and better support throughout the implementation phase.

And lastly, a well-planned implementation timeline enables HR teams to prepare and allocate resources effectively, minimizing any potential disruptions to ongoing stipends, workflows, or budgets.

Our customers have found that a shorter implementation timeline is better because it returns ROI quicker, reflects the maturity of process and expertise of the solution provider, and allows HR to plan properly.


Additional considerations when selecting a perk management vendor:

1. International functionality

The value is most when every employee can use their stipends equally, regardless of where they live. If your company is international, you’ll want to make sure you create a program that can support everyone.

If your company has employees worldwide, be sure to ask the vendors you’re considering how they support your international people.

2. Pre-funded vs. pay-as-you-go

Pre-funded models force you to pay for the entire amount allotted to your people upfront. If you have tremendous amounts of cash and this isn’t a big deal, this method might be fine.

However, something more significant to consider is what happens to the money which isn’t used -- does it remain in employees’ accounts in perpetuity or get refunded back into the company’s hands.

Alternatively, there are pay-as-you-go models. These are where you only pay for what is spent by your employees which not only allows you to keep your cash on hand until the money is spent but any money that isn’t spent is kept in the company’s pocket.

3. Vendors vs. Vendorless

When looking into a new stipend management tool, consider if you’d like to go with a vendor-based or a vendorless approach.

Vendor-based approaches are like a marketplace, similar to when you cash in points from your credit cards. There are pre-selected vendors, first selected by the software tool you’ve chosen, and then chosen by you. 

A vendorless approach is one which is compatible with every vendor because there are no vendors, making the options for perks and benefits selected unlimited. HR can still select individual spending categories like a health & wellness stipend or offer multiple categories -- health & wellness, food, equipment, and learning & development within one stipend. 

The significant difference is that there are no vendors for people to choose from, which means they can buy whatever is best for them from their favorite meditation app to a healthy meal delivery kit or their local yoga studio. 

At Compt, we’re vendorless, and our model uses receipt reimbursement so that HR professionals can track spending, ensure IRS compliance, and, most importantly -- offer true personalization.

Questions to consider:

  • Which of these will align more with our organization’s values?
  • Which of the following will give our people greater access, inclusivity, and personalization?
  • Which would I prefer to use?
  • Which provides us with a tremendous competitive advantage?

4. Points vs. Dollar Compensation

Point systems have been around for a while and are what larger legacy companies like Achievers and Rewardian built their recognition software. And points can be fun, but they can also introduce unnecessary complexity. 

The dollar compensation model is gaining traction as it’s the most straightforward and easily-understood model by your people. The money can be either dropped into an employee’s paycheck every month (which Laszlo Bock’s research at Google advises against) or can be given on a debit/gift card or through a reimbursement model. The latter approach still encourages employees to be proactive about what they want by purchasing it and then being reimbursed at a later date.

5. Debit Cards vs. Perk Reimbursement Models

We wrote an in-depth and honest review of the two approaches here

However, the debit card model has grown tremendously over the past few years with companies like Benepass, Hoppier, and Mistro jumping on the train. They’re great because they have a “cool factor” associated with them -- especially for younger team members who crave the prestige of a company card. The high-level options to consider are limited to stipends due to needing to be used with preselected vendors only, what happens to the money that isn’t spent, and IRS tax compliance.

The stipend reimbursement model is one we know well at Compt, as that is the approach we take. While we can’t speak for other companies that take this approach (we’re currently the only one on the market) -- this model allows you to have 100% personalization (every vendor is possible), pay only for what you use, and they’re fully IRS compliant. 

6. Bonus functionality

The rewards and recognition software market is saturated with options to recognize your people, as well as them to recognize each other, whether it’s through high-fives, thanks notes, badge-giving, or gift cards.

If you don’t have a recognition platform in place yet, some of the vendors mentioned above also include bonus program functionality, which is a way to celebrate work anniversaries, implement sales spiffs, or celebrate a job well done.


Additional Resources:


A Holistic Lifestyle Benefits Platform

Offering the most inclusive and personalized employee perks and benefits.

Your cart