U.S. Treasury: Direct Deposit On Upswing In Hurricane-Prone States

The Treasury Department is set to end the use of paper checks for federal benefit payments on March 1, 2013. Texans are going paperless well ahead of schedule, in no small part because of the lessons of recent hurricanes. Andrew Schneider has more.

digital moneyA survey of federal benefits recipients in southeastern and Gulf Coast states shows that 86% of recipients are taking their payments electronically. Texas comes in a hair above the regional average.

David Lebryk is commissioner of the Treasury Department’s Financial Management Service.

“After Hurricanes Katrina and Rita, tens of thousands of emergency payments had to be issued to people who had been displaced. In contrast, virtually all the people who had direct deposit were able to access their money immediately.”

Lebryk says this spring’s devastating tornadoes provided many fresh examples. But natural disasters aren’t the only reason people are abandoning check payments. Gary Beets, regional director at the department’s Kansas City Financial Center, says baby boomer retirements are also a factor.

“They’ve grown up with and lived with direct deposit of payroll and other kinds of transactions, so there’s a greater familiarity with electronic banking.”

Texas still receives nearly 600,000 checks a month for Social Security, veterans’ benefits and other payments. That makes it the second-largest recipient of federal benefit checks in the nation.


Andrew Schneider

Andrew Schneider

Politics and Government Reporter

Andrew heads Houston Public Media’s coverage of national, state, and local elections. He also reports on major policy issues before the Texas delegations in the U.S. House and Senate, as well as the Texas governorship, the state legislature, and county and city governments. Before taking up his current post, Andrew...

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