Tuesday, December 28, 2010
The U.S. Department of the Treasury said that by March 1, 2013, benefits payments delivered to recipients by paper check will be completely phased out. By that time, all recipients of social security payments and other types of federal benefits will have those funds direct deposited to bank accounts or loaded onto Direct Express Debit MasterCard prepaid cards.
The Treasury said 80 percent of all benefits recipients have already signed up for one or the other electronic process, with 1.5 million people having opted for the open-loop, MasterCard Worldwide-branded Direct Express card since the program was introduced in 2008.
By transitioning to an entirely electronic benefits payments system, the Treasury expects to save the Social Security program $1 billion over 10 years and $120 million annually from the elimination of paper check distribution and processing.
The Treasury said any person who applies for benefits on or after May 1, 2011, will receive payments electronically, while those recipients who currently receive funds via paper checks will need to switch to direct deposit or the Direct Express card by the March 2013 deadline.
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