Nacha filed comments on March 10, 2023, in support of the Treasury Department’s efforts to implement a statutory mandate requiring the federal government to deliver non-tax payments by electronic funds transfer (EFT).
Nacha’s comments reiterated that issuing payments electronically continues to reduce costs and improve efficiency across the federal government. It pointed out that if Treasury could convert to ACH the approximately 45 million checks distributed in 2022, the savings would be over $86.8 million. The letter also noted that another benefit of electronic payments is the promotion of financial inclusion goals.
The ability to receive government payments with certainty was recently cited in a 2021 FDIC survey reporting that unbanked levels in the United States were at their lowest rate since tracking began in 2009. The FDIC stated, “The importance of quickly receiving income from Economic Impact Payments or other government relief programs created a unique bankable moment, and consumers benefited from enhanced online and mobile account opening technologies and the greater availability of safe and affordable bank accounts. This combination of factors resulted in meaningful gains in connecting households to the banking system.”
Nacha’s letter also encouraged Treasury to:
- Provide for the sharing of payment enrollment information across agencies to the extent possible and to seek congressional authorization to do so if necessary.
- Utilize customer-facing enrollment portals, similar to the IRS’ portal, for providing banking information for EIPs.
- Use industry-available account validation tools and services to promote greater accuracy of payment information. An example was when Treasury utilized verification tools for the six months of ACTCs the ACH return rate dropped from a modest 1.7% in July to 0.1% by the final December payment.