Payments can be traced through the banking system and beneficiaries have a permanent record of their payment through their bank records. There are economic advantages of EFT for beneficiaries as well. Benefits are credited to accounts at the opening of business on the scheduled payment date. Beneficiaries can write checks to pay bills or use automated teller machine cards to obtain money immediately without the inconvenience of first having to cash a check. Also, direct deposit avoids check cashing fees and fees for money orders and similar charges can be avoided.
Many financial institutions offer free services for customers who use direct deposit.
There are also economic advantages to society. Direct deposit avoids the costs included in Secret Service investigations and financial institution liability associated with forged checks. Direct deposit is also more convenient. Beneficiaries are not required to be home to receive their payment, nor do they have to be concerned about their check being delivered during an unexpected absence from home, such as a medical emergency that requires a hospital stay. The Debt Collection Improvement Act of 1996 was designed to bring about more efficient and cost-effective Government operations by encouraging Federal check recipients to convert to electronic payment.