Electronic Transfers: Use by Federal Payment Recipients Has Increased but Obstacles to Greater Participation Remain

摘要

In 2001, the Department of the Treasury made approximately 764 million payments valued at $549 billion to beneficiaries of federal programs, primarily programs administered by the Social Security Administration (SSA). Of these payments, about 76 percent were made using electronic funds transfers (EFTs), potentially saving the government millions of dollars in costs associated with disbursing paper checks. In 1996, Congress passed the Debt Collection Improvement Act, which required that federal payments except tax refunds be made electronically as of January 1999. The act also required that each person affected by this mandate have access to an account at a financial institution at a reasonable cost and with certain consumer protections. To meet this requirement, Treasury developed the Electronic Transfer Account (ETA). The ETA, designed specifically for federal beneficiaries who do not have bank accounts, allows account holders to receive federal benefits electronically and to make withdrawals but not to write checks. Based on congressional concerns about a more stringent wavier provision, Treasury's final regulations provided that a recipient may continue to receive checks by mail if payment by EFT would impose a hardship and allowed individuals to determine for themselves if payment by EFT would impose a hardship. In 2001, Treasury was still disbursing about 24 percent of all its federal benefit payments by check. Concerned about the possibility that the government is not capturing all the potential cost savings from EFT, you asked us to examine the status of EFT usage and the ETA program.