One week from today will mark the end of September, and with the end of the month comes the end of paper checks at the Social Security Administration (SSA). The SSA, along with the broader federal space, will be transitioning all payments from paper based to electronic as of September 30th. This change is being made in the broader federal government in accordance with the executive order titled “Modernizing Payments To and From America’s Bank Account”, which had been issued by the White House on March 25th.
On Friday, the SSA posted an update on its blog reminding beneficiaries that the deadline to switch over payment methods is fast approaching. Here is everything you need to know.
SSA issues important reminder
On September 19th, the SSA issued a post on its blog to remind paper check recipients that “all federal benefit payments will soon be issued electronically, and paper checks will be phased out in most cases,” once September ends. While there are well over 70 million beneficiaries in the Social Security program, this digital mandate only affects 521,644 individuals, according to the SSA’s data. This is because the vast majority of over 99% of Social Security recipients already receive their monthly benefit income electronically.
According to the executive order, the use of paper based payments “imposes unnecessary costs; delays; and risks of fraud, lost payments, theft, and inefficiencies.” Additionally, mail theft complaints have increased dramatically since the COVID-19 pandemic, and while electronic banking does carry its fair share of risks, “Department of the Treasury checks are 16 times more likely to be reported lost or stolen, returned undeliverable, or altered than an electronic funds transfer (EFT).”
A few days ago, the SSA put out a reminder on social media platform X that read as follows: “Social Security is switching to electronic payments! If you still get paper checks, act now to avoid payment delays. Enroll in direct deposit or Direct Express by Sept. 30.”
Aside from enhanced security and increased efficiency, transitioning payment methods away from paper checks or money orders in this manner could save the federal government millions of dollars annually. Citing the U.S. Department of the Treasury, the SSA noted that “issuing a paper check costs about 50 cents, whereas an EFT costs less than 15 cents.”
“To ensure you continue receiving your benefits without interruption, please take action before the September 30 deadline,” the SSA wrote in the update. Beneficiaries can switch over their payment method to one of the two available options: Direct Deposit, or Direct Express Card. If opting for a Direct Deposit, beneficiaries can manage this directly through their my Social Security account. If the beneficiary does not have a bank account, they should enroll in a Direct Express Card, and this can be done by calling 1-800-333-1795 or visiting www.usdirectexpress.com.
Exceptions will be made
The agency has also shared that technicians will be available to assist beneficiaries in navigating this change or to answer any questions. However, if a beneficiary is unable to transition their payment method (due to being of an extremely advanced age, or a lack of access to the required infrastructure, for instance), exceptions will be made and the SSA will continue to disburse paper checks even once September ends.
In the September 19th blog update, the SSA wrote: “Please note: temporary checks are no longer available for initial claims and anyone seeking an exemption must file a waiver with the U.S. Treasury by calling 1-877-874-6347. If you have no other way to receive payments, we will continue to issue paper checks. There are no plans to pause any payments starting October 1.”
SSA Commissioner Frank Bisignano also previously shared confirmation that the agency will continue to issue paper checks to those who need it, as per a press release from Sen. Elizabeth Warren.