MONTVALE, N.J., Feb. 21, 2013 /PRNewswire/ -- For the past several years, state and federal governments have been migrating consumers to electronic government benefit payments (direct deposit or prepaid debit cards) from paper checks in order to reduce fraud, save money and improve the overall customer experience of receiving benefits. Recently, the U.S. Department of the Treasury set a target of March 2013 for all of these payments to transition to electronic delivery, including all federal benefit and non-tax payments such as Social Security Income and Supplemental Security Income.
"The economy is increasingly shifting from cash to digital currency because of the security and convenience it provides. Prepaid debit cards have become a popular option that anyone can take advantage of to manage funds, budget and pay bills," says Kirsten Trusko, president of the Network Branded Prepaid Card Association (NBPCA). The NBPCA is a non-profit, inter-industry trade association that supports the growth and success of network branded prepaid debit cards.
For the estimated 60 million Americans who don't manage their finances with a bank account, a prepaid debit card is a safe, convenient option to receive their benefit payments electronically. Issued by highly regulated banks and financial institutions, prepaid cards can be used like a debit card at ATMs or for purchases anywhere the brand is accepted. Funds on bank-issued prepaid debit cards are protected by FDIC insurance and the card brands' zero liability policies. They do not require credit checks with credit bureaus and ChexSystems, but do require full customer identification.
The Network Branded Prepaid Card Association (NBPCA) offers the following tips to consumers moving from checks to prepaid debit cards to receive government benefit payments:
- If you currently have a prepaid debit card, use it. You can add your government benefit payments to a prepaid debit card that was issued by an insured financial institution that you fund yourself or that is funded by an employer. There is no need to get another card.
- Review all the card options. One option is the DirectExpress® Card offered by the Department of the Treasury, but you can also choose an alternate prepaid debit card to receive payments, so find the card that works best for you.
- Visit Go Direct.org to read frequently asked questions.
- Get ready to receive your funds faster. Government benefit funds will be available on the day of payment. No need to call Social Security, worry if the check is in the mail or wait in line at the bank or check casher to cash the check.
- Eliminate fees and surcharges with a little planning. Most prepaid debit cards offer free bank transfers, free customer service options, free cash back at point of sale, free ATM transactions at in-network ATMs, free purchase transactions and online tools to track funds. Take a few minutes to read the information that comes with your card to understand how you can access your money surcharge free.
- Save money. Studies show prepaid cards can be cheaper than using check cashing facilities and checking accounts. Read your card terms and conditions to find out ways you can save money.
- Prepaid card funds are protected- As a cardholder, your funds are protected if lost or stolen. Banks who issue reloadable prepaid cards offer the same consumer protections as apply to checking accounts with debit card access, FDIC insurance to cardholders AND the card brands offer zero liability protections against fraudulent use.
About the NBPCA
The Network Branded Prepaid Card Association (NBPCA) is a non-profit, inter-industry trade association that supports the growth and success of network branded prepaid debit cards and represents the common interests of the many players in this new and rapidly growing payments category. For additional information visit www.NBPCA.org or follow us on Twitter.
CONTACT: Jennifer Tramontana
SOURCE Network Branded Prepaid Card Association