The federal government plans to stop issuing paper checks for most federal payments at the end of September, according to an announcement by the U.S. Treasury Department.
The move aligns with Executive Order (EO) 14247, titled “Modernizing Payments to and From America’s Bank Account,” which directs the agency to transition federal disbursements to electronic payments, beginning Sept. 30.
Anyone currently receiving paper benefit checks will need to switch to an electronic payment method by that date.
“Reducing paper checks has been a longstanding bipartisan goal that our administration is finally putting into action,” Treasury Secretary Scott Bessent said in a press release. “Thanks to President (Donald) Trump, this will help reduce fraud and theft. It will also remove delays that prevent hardworking Americans from receiving their vital payments.”
The agency noted the vast majority of Americans already receive federal benefit payments electronically, meaning they will not have to take any action with respect to this announcement.
In the spring, the Treasury issued a request for information (RFI), asking interested stakeholders to provide feedback on the department’s implementation of the EO, as well as recommendations for how to increase public awareness and help consumers, including unbanked and underbanked populations, transition to digital payments.
The agency received more than 500 comments, including several from financial services trade organizations stressing the need to educate consumers about how to protect themselves against check fraud and for the Treasury to account for consumers who cannot access digital banking solutions.
The Bank Policy Institute, The Clearing House and the Consumer Bankers Association responded with a joint letter on the matter.
“The prevalence of check fraud remains a challenge, with criminals continuing to exploit this legacy payment system,” the trade groups wrote. “In 2024, check fraud accounted for 32 percent of all fraud losses. Treasury checks are a particular target given the large number of these checks issued and delivered through the U.S. mail in distinctive envelopes. Treasury checks also attract fraud because their funds generally must be made available the day after deposit. Removing paper Treasury checks from circulation is an important step toward reducing theft and the related losses to the federal government and financial institutions. Treasury’s efforts to phase out paper checks in government payments represent a critical opportunity to modernize America’s payment infrastructure, reduce fraud and increase financial security for American taxpayers.”
America’s Credit Unions (ACU) noted its appreciation of the federal government’s efforts to facilitate more timely access to information about whether a government check is valid or has already been paid through upgrades to its Treasury Check Verification System (TCVS) in 2024.
“To prepare for the transition away from disbursing physical checks, we urge Treasury to take the lead in educating the public on how to securely establish direct deposit access and guard against the risk of fraud or identity theft which may be heightened for unbanked populations — especially during the transition period,” John Vatian, regulatory advocacy counsel, innovation and technology at ACU, wrote in a comment letter.
Those who receive a paper check for Social Security benefits, veterans benefits or any other federal benefit will have to enroll in direct deposit using one of the following options:
- Call the federal agency responsible for paying your benefits and follow their instructions for enrolling in direct deposit. A list of the paying agencies’ contact information can be found here.
- Enrolling online at GoDirect.gov
- Call the Electronic Payment Solution Center at 800-967-6857, Monday – Friday 9 a.m. to 7 p.m. ET
For anyone without a bank account, the agency has provided resources explaining how to open an account at FDIC: GetBanked and MyCreditUnion.gov.
The agency also has urged consumers to sign up for a Direct Express Debit Mastercard – a Treasury-sponsored debit card that allows cardholders to receive monthly benefit payments electronically. Individuals without a bank account can sign up by calling Treasury’s Electronic Payment Solution Center at 800-967-6857 or by contacting the relevant agency directly.