The United States Treasury Department has taken the decision to phase out federal benefits paid by cheque. Beginning on 1 March 2013, all residents who receive social security and supplemental security income will receive their benefits via an electronic debit process. Recipients must open a direct deposit or account in order to continue receiving funds.
Nationally, 93% of government payments are made electronically, leaving around five million cheques sent in the post every month. Treasury representative Tepricka Morgan explained, “Electronic payments are definitely safer than posted cheques. Around 440,000 cheques were lost or stolen nationwide in 2011, and USD70 million worth of cheques were fraudulently endorsed.” In addition to solving these problems, the change to electronic payment will save the US Government USD1 billion over the next ten years.
A SmartDebit representative added, “Council’s in the UK have been moving towards online, electronic payment processing in recent years to cut costs, streamline operations and drive efficiencies. It is no surprise that the US has decided to do the same to distribute federal benefits. Electronic payments are more secure, speedier, accurate and can be easily traced.”
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