U. S : SOCIAL SECURITY AND FEDERAL BENEFIT PAYMENTS SWITCH TO ELECTRONIC AS PAPER CHECKS ARE PHASED OUT THIS MONTH. (PHOTO).

 Social Security and federal benefit payments switch to electronic as paper checks are phased out this month

The federal government is set to phase out paper checks for most Social Security recipients and other federal benefit payments this month, moving them to electronic delivery. The transition follows an executive order signed by President Donald Trump in March, requiring all federal benefit payments to be made electronically by September 30.

The shift aims to reduce fraud and lower costs. According to the executive order, paper checks are more prone to theft, loss, or being returned than electronic funds transfers. The Labor Department estimates the change could save millions of dollars annually, as issuing a paper check costs roughly 50 cents, compared with under 15 cents for an electronic transfer. Most beneficiaries already receive payments electronically, with fewer than 1% of Social Security recipients using paper checks, and over 97% of Veterans Administration benefits delivered electronically.

Recipients who already receive electronic payments do not need to take any action. Those still receiving paper checks can enroll in direct deposit through their federal agency, online at GoDirect.gov, or by calling the Treasury’s electronic payment solution center at 800-967-6857. For individuals without a bank account, options include opening one through FDIC: GetBanked or MyCreditUnion.gov, or receiving payments via a Treasury-issued debit card. Some beneficiaries may still receive paper checks if they have no other way to receive funds. The Veterans Administration is required by law to provide paper checks to veterans who request them.

The transition may pose challenges for people who are homeless, disabled, unbanked, or uncomfortable with electronic payments, according to Tracey Gronniger, managing director of economic security at Justice in Aging. Beneficiaries needing a waiver to continue receiving paper checks can qualify if they live in remote areas, are 90 or older, or have a mental impairment, with the Treasury reviewing guidance on waivers. New electronic payment users should also be cautious of scams, and the Treasury recommends verifying requests through official government channels before responding.