President Donald Trump signed an executive action this week directing the Treasury Department to phase out paper checks and use electronic payments instead.
The Presidential action, “Modernizing Payments to and from America’s Bank Account,” stated that using “paper-based payments” leads to delays and “risks of fraud.”
“President Trump is cracking down on waste, fraud, and abuse in government by modernizing outdated paper-based payment systems that impose unnecessary costs, delays, and security risks,” a fact sheet outlining the plan reads.
The statement also notes that mail theft complaints are on the rise.
In 2023, the U.S. Postal Service warned customers against sending checks in the mail due to rising fraud.
What payments does the executive order affect?
The Treasury was directed to “cease issuing paper checks for all Federal disbursements,” which means all government payments, including intragovernmental, benefits, and vendors.
It also includes tax refunds.
Payments will instead be issued by direct deposits, debit and credit card payments, digital wallets, and “other modern electronic payment options.”
Related: Check Fraud Is On the Rise. Here’s How to Avoid Being a Victim.
When will the government stop paper checks?
The order goes into effect this fall, on September 30, 2025.
What if you don’t have access to digital banking?
There are several carve-outs for people without access to digital payment systems or those who can’t receive electronic payments. In those cases, “individuals or entities qualifying for an exception” will be “provided alternative payment options.”
The order does not state how this would be determined or how to apply for the exception. It also doesn’t state what the alternatives will be.
Related: The IRS Is Reportedly Planning to Cut Up to 45,000 Workers — Half of Its Workforce
