# Presentation: 680874

## Electronic Alternatives for the Federal Benefit Check Recipient

*U.S. Dept. of the Treasury FMS, Payment Management*
* **EFT Strategy Division*
*April 3, 2008*

**Go Direct®****Direct Express®**

## Why Electronic Payment Methods?

- Cost Effective for the Government
- In FY 2007, 149.4 million benefit checks were disbursed
- It costs FMS $0.88 more to issue a check than an EFT
- If all of the benefit check payments were converted to EFT, the annual savings to the taxpayer would be $131.5 million
- Safe, Secure, and Reliable
- When there is a problem with a payment, 9 times out of 10 it is with a paper check
- Eliminates risk of stolen checks, forgeries and helps protect against identity theft
- Reliable delivery of payments in disasters & emergencies as Hurricane Katrina illustrated in 2005

## What is Go Direct?

- National Direct Deposit marketing campaign targeted at current banked federal benefit check recipients.
***Go Direct*** is sponsored by the Treasury and the Federal Reserve Banks.
- Partners include financial institutions, volunteer tax preparation sites, social services agencies, community-based groups and other organizations.

## Go Direct Milestones

- Over 1.7 million enrollments since April 2005
- Enrollments to date will save the government an estimated $136 million dollars over the next 10 years
- 100% of the year three campaign goal (408,000) has been achieved in the first six months of this campaign year

## Go Direct Enrollment Methods

- Dallas Call Center
- Phone
- Dedicated toll-free help line (800) 333-1795
- Averaging over 60,000 calls a month in year three, while successfully converting 96% of total calls to Direct Deposit
- Web Site
- _[www.GoDirect.org](http://www.godirect.org/)_
- Averaging over 15,000 enrollments per month in year three
- Direct Mail
- Recent direct mail efforts in New York, North Carolina, Los Angeles and Miami have yielded response rates between 2.5% and 5%
- Financial Institutions (FI)
- FI ***Go Direct*** partners can assist beneficiaries in the enrollment process

## Why Direct Express?

- Solution for the unbanked federal benefit recipient.
- The Go Direct call center receives 6,000 to 13,000 calls each month from unbanked federal benefit recipients inquiring about alternatives to paper checks.
- According to a survey conducted by KRC research in the Fall 2007:
_***28 percent***_ of SSA check recipients are unbanked.
- Based on February 2008 SSA check payment data, this indicates there are approximately ***2.1 million*** unbanked SSA recipients.
_***59 percent***_ of SSI check recipients are unbanked.
- Based on February 2008 SSA check payment data, this indicates there are approximately ***1.8 million*** unbanked SSI recipients.

## Direct Express Card Features

- Comerica Bank issued MasterCard-branded prepaid debit card with a magnetic stripe supporting personal identification number (PIN) or signature-based transactions (POS)
- May be used anywhere MasterCard is accepted to
- make purchases at retail locations
- get cash-back at retail locations
- get cash at an automated teller machine (ATM)
- get cash at MasterCard member banks and credit unions (at the teller window)
- make online or telephone purchases
- pay bills online or by telephone
- transfer funds to a U.S. personal bank account
- FDIC–insured and Regulation E protected
- Cardholders will have 90 days to dispute charges with Comerica, rather than the 60 days required by Reg E.
- Reloadable with Federal benefits only
- Funds will not be subject to freezing or garnishment, except as authorized by federal law, for example, when the cardholder owes delinquent federal taxes or delinquent child support.

## Direct Express Card Fees

| SERVICE | FEE | SERVICE | FEE |
| --- | --- | --- | --- |
| Monthly maintenance | FREE | Denied transaction (ATM or POS) | FREE  |
| First automated teller machine (ATM) cash withdrawal per deposit1  | FREE | Toll-free telephone or online customer assistance (24/7) | FREE |
| Additional ATM withdrawals1 | $0.90  | Replacement card (one free per year) | $4.00  |
| Point-of-sale (POS) transactions (including cash back) | FREE | Expedited replacement card | $13.50  |
| ATM withdrawal fee (international)
- Currency Fee (3%) will be added | $3.00  | Monthly paper statement mailed | $0.75  |
| Bank teller cash withdrawal | FREE  | Deposit/ Low Balance Notification | FREE  |
| ATM balance inquiry  | FREE | Overdraft fee | FREE |
| IVR funds transfer to personal U.S. bank account | $1.50 | Inactivity fee  | FREE  |
| 

      1Additional fees may be charged to you at ATMs outside the Direct Express Network.  Direct Express network to date includes Comerica, MoneyPass, PNC, Alliance One, Citizens/Charter One, Shazam, and MasterCard SFA, approximately 50,000 surcharge free ATMs. |  |  |  |
|  |  |  |  |

## Direct Express CardNationwide Launch

- In Spring 2008, FMS will launch its new Direct Express prepaid debit card program.
- A dual message check insert will be sent in April/May to Social Security and Supplemental Security Income (SSI) check recipients in Texas, Oklahoma, Arkansas, and Louisiana soliciting participation in Direct Express. The insert campaign will expand nationwide by Fall 2008.
- Additionally, beneficiaries will be informed about the Direct Express Card through our education campaign which includes:
- Partner Outreach to “trusted sources”
- Media
- Printed Materials

## Direct Express Card Enrollments

- Beginning in late Spring 2008, Social Security beneficiaries will be able to enroll via the phone or the web
- Call Center
- 1 (877) 212-9991
- Web Site
- _[www.USDirectExpress.com](http://www.usdirectexpress.com/)_

## QUESTIONS?

- Contact Information:
- 	Nevelyn Jones
- 	Financial Management Service
- 	401 14th Street SW
- 	Washington, DC  20227
- 	(202) 874 – 9602
- 	Nevelyn.Jones@FMS.Treas.gov