The Treasury has stopped offering paper checks for new recipients of Social Security and other federal benefits and shifts towards electronic payments.

As of May 1, the U.S. Department of the Treasury will no longer issue paper checks for Social Security payments and other federal benefits for new applicants.

Anyone applying for Social Security and other federal programs must choose to receive their payments via direct deposit into a bank account or prepaid Direct Express® debit cards.

Seniors who are already receiving Social Security payments in the form of paper checks will continue to get them in the mail until March 1, 2013. Current paper check recipients have until that date to establish an electronic form of receiving federal benefits.

The Treasury projects taxpayer savings of $1 billion over the next 10 years…

“It costs 92 cents more to issue a payment by paper check than by direct deposit,” said Rosie Rios, Treasurer of the United States. “We are retiring the Social Security paper check option in favor of electronic payments because it is the right thing to do for benefit recipients and American taxpayers alike.”

The decision to eliminate paper checks for federal benefit payments was finalized in December 2010, before the Treasury also decided to promote tax refunds in the form of prepaid debit cards. The Treasury projects taxpayer savings of $1 billion over the next 10 years as a result of this change.

Read: U.S. Treasury to Pilot Prepaid Debit Card Program

Lost and stolen paper Social Security checks is another reason that the Treasury is shifting towards electronic payments. It costs more taxpayer dollars to reproduce those paper checks while the entire ordeal delays much-needed income for retirees.

According to the Treasury, roughly 85% of Social Security beneficiaries are being paid through direct deposit while more than 1.5 million beneficiaries have already opted for a Direct Express Debit MasterCard.

Switch from paper checks to direct deposits or the Direct Express debit card by visiting or by calling toll-free at 1-800-333-1795.

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