Modernizing Payments To and From America's Bank Account
The order directs the federal government to stop issuing paper checks and transition all federal disbursements and receipts — including benefits, tax refunds, vendor payments, and fees — to electronic payment methods by September 30, 2025.
It affects virtually every federal payment flow touching American households and businesses, and builds in limited exceptions for people without bank accounts, emergencies, and national security situations.
What this order does
What it orders
The order directs the Secretary of the Treasury to cease issuing paper checks for all federal disbursements — including benefits, tax refunds, vendor payments, and intragovernmental payments — effective September 30, 2025. All executive agencies must transition to electronic funds transfer methods such as direct deposit, prepaid cards, and digital wallets, and must actively enroll recipients. Payments made to the federal government, including fees, fines, loans, and taxes, must also move to electronic processing as soon as practicable. Several cabinet secretaries are directed to eliminate the need for Treasury's physical lockbox services.
The order carves out exceptions where electronic methods are not feasible, including for individuals without bank access, certain emergency payments, and national security or law enforcement activities. It explicitly states it does not establish a Central Bank Digital Currency. Agencies must submit compliance plans to OMB within 90 days, and Treasury must submit a progress report to the President within 180 days.
Who it affects
All Americans and businesses that receive or make payments to the federal government, including Social Security and benefits recipients, federal contractors and vendors, tax filers seeking refunds, and unbanked or underbanked individuals who will need access to alternative payment options such as prepaid cards.
Why it matters
People currently receiving federal checks by mail — including benefits recipients and tax refund recipients — will be shifted to direct deposit or prepaid cards. Unbanked individuals face the biggest adjustment, though exceptions and alternative options are required. The change is projected to eliminate hundreds of millions of dollars in annual processing costs.
What must happen and when
How the order is supposed to work
Treasury leads implementation, providing agencies access to centralized electronic payment systems covering direct deposit, card payments, digital wallets, and real-time payment rails. Each agency submits a compliance plan to OMB within 90 days, giving agencies a roadmap obligation before the September 30, 2025 hard cutoff. Treasury runs a public awareness campaign and works with financial institutions to address the unbanked. Treasury also reviews exception procedures and reports progress to the President at 180 days. No self-enforcing penalty mechanism is specified; compliance is managed through OMB oversight and Treasury coordination.
Actions and deadlines
- Cease issuing paper checks for all federal disbursements, including benefits, tax refunds, and vendor payments
- Submit agency compliance plans to OMB detailing strategy for eliminating paper-based transactions
- Develop and implement a public awareness campaign informing recipients of the transition to electronic payments
- Review and revise procedures for granting exceptions where electronic payment is not feasible
- Eliminate the need for Treasury's physical lockbox services and transition federal receipts to electronic processing
- Submit an implementation report to the President detailing progress on the electronic payment transition