Social Security beneficiaries have been faced with some back and forth in recent weeks regarding the Social Security Administration’s recent announcement which stated that the agency will no longer issue paper checks as of September 30th. This update from the agency came about in accordance with the March 25th executive order issued from the office of the president.
According to the order titled “Modernizing Payments To and From America’s Bank Account”, the use of paper based payments will be phased out both to and from the federal government on September 30th. The Social Security Administration has recently backtracked on this decision, however. Here is what you need to know.
Goodbye to paper checks from Social Security?
On July 14th, the SSA shared an update on its blog stating that, “starting September 30, 2025, the Social Security Administration (SSA) will no longer issue paper checks for benefit payments.” Much like the initial executive order, the SSA also explained that transitioning to digital payments this way will increase speed and efficiency, cut costs, and enhance security. Citing the U.S Department of Treasury, the agency also noted that “issuing a paper check costs about 50 cents, whereas an EFT costs less than 15 cents. This shift could save the federal government millions of dollars annually.”
Over 99% of Social Security beneficiaries already receive their monthly benefits electronically via direct deposit, however >1% of paper check recipients still amounts to at least half a million individuals. This shift towards digitization comes as no surprise considering the state of the world at large, not to mention that this has been long coming in the federal space as well.
The agency says it is “proactively sending notices to people who currently receive paper checks, to explain the upcoming change and highlight the benefits of switching to electronic payments. In addition, all benefit checks will include an insert explaining the steps a beneficiary can take to transition to electronic payments, and our technicians are ready to assist.”
Despite this, making this change could prove to be quite difficult for the under 1% of beneficiaries who currently receive paper checks. Receiving payments electronically could be impossible for many due to being unbanked, or not having access to the internet and electronic banking services. Beneficiaries could also be of an extremely advanced age which could prevent them from navigating this change due to being technologically inept.
SSA backtracks on digital mandate
For the reasons mentioned above, the decision to phase out paper checks when paying out benefits was not exactly well received. In particular, Senator Elizabeth Warren shared strong opinion regarding this change. In a press call, Sen. Warren stated the following: “There are about 600,000 Americans who still receive their paper checks — it’s a small fraction of people who receive Social Security payments, but it’s a population that often needs checks through paper.”
Sen. Warren then went on to meet with SSA Commissioner Frank Bisignano to discuss a number of agency matters such as reported metrics, staffing, and the inaccurate email regarding the One Big Bill Act that had been sent out. According to the July 23rd press release, Sen. Warren also asked Commissioner Bisignano about the decision to stop issuing paper checks. In response, Commissioner Bisignano “committed not to entirely remove the option for beneficiaries to receive paper checks, backtracking on the agency’s own recent announcement to “stop issuing” them.”
In short, paper checks will still be issued to those who require it. According to the Treasury run program, GoDirect, a waiver will be granted to recipients who meet any one of the following requirements:
- They have a mental impairment that would make receiving payments electronically a hardship.
- They live in a remote area without the infrastructure to process electronic financial transactions.
- They are 90 years of age or older.