For millions of Americans, getting a paper check from Social Security or SSI in the mailbox each month is a regular ritual.
But in the last year, the U.S. Treasury has been quietly campaigning to get Social Security and Supplemental Security Income recipients to switch to a plastic, prepaid debit card.
The program, called Direct Express, is aimed primarily at the 4 million Social Security and SSI recipients who don’t have a regular bank account. But it’s available to anyone. Instead of a paper check, the plastic card is automatically loaded with the amount of your monthly Social Security or SSI check.
It’s billed as a safe, convenient way for consumers to get their monthly government income while preventing fraud, theft and loss of paper checks.
The other alternative to paper checks, of course, is direct deposit into an existing bank account, which has been a long-standing option.
Every year, the U.S. Treasury receives 1.4 million complaints from Social Security and SSI recipients.
“Those paper checks are problematic. They get lost, stolen or aren’t received on time,” said Phil Belisle, regional director of the U.S. Treasury’s financial center in San Francisco. “The debit card is a very safe alternative.”
It’s also a big money-saver for the federal government.
“In California alone, we could save $9.5 million a year if we were able to stop mailing those 840,000 SS and SSI checks,” said Belisle.
The Direct Express debit card is tied to the Comerica Bank ATM network, so it can be used without charge at any of its companion banks. Every cardholder is entitled to one free ATM withdrawal a month.
To avoid the fees, a Direct Express card can be used at most retail locations, such as grocery stores and pharmacies, where you can get cash back, or at banks and credit unions that accept the MasterCard debit card.
And like any debit card, it carries some of the same protections against losses if it’s stolen.
But there are some fees. If you want a monthly paper statement, there’s a fee. If you make more than one ATM withdrawal per month, there’s a fee.
Belisle said the Treasury “worked hard to keep the amounts lower than the typical debit card,” noting that the Direct Express ATM withdrawal fee is about 90 cents, compared with some regular debit cards whose ATM fees run as high as $3 per transaction.
Since the program started early last year, about 500,000 Americans have signed up for Direct Express debit cards.
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