Executive Order-Transition to Electronic Federal Payments effective September 30, 2025
On March 25, 2025, the President signed an Executive Order titled Modernizing Payments To and From America’s Bank Account. The order mandates a government-wide transition from paper-based payments (such as checks and money orders) to electronic payment methods.
Key Points:
• Effective Date:
The mandate takes effect September 30, 2025.
• Scope:
All federal disbursements—including tax refunds, Social Security, vendor payments, and other government payments—will be issued electronically. Similarly, payments made to the federal government (e.g., taxes, fees, fines) must also be processed electronically.
• Electronic Payment Options Include:
◦ Direct deposit
◦ Prepaid card accounts
◦ Debit/credit cards
◦ Digital wallets and real-time payment systems
◦ Other modern digital payment options
• Exceptions:
Limited exceptions will be permitted, such as for:
◦ Individuals without access to banking or electronic payment systems
◦ Certain emergency or hardship situations
◦ National security or law enforcement activities
◦ Other circumstances as determined by the Secretary of the Treasury
• Support & Awareness:
The Treasury will launch a public awareness campaign and provide guidance for setting up electronic payments. Agencies will support recipients in the transition and address concerns for unbanked or underbanked individuals.
• Security & Privacy:
The order emphasizes the protection of sensitive information, including tax return data and personally identifiable information.
Action Items for You:
• If you currently receive federal payments by check (including tax refunds or benefits):
Ensure your electronic payment information with government agencies is up to date before September 30, 2025. This will help prevent delays.
•If you make payments to the federal government by check or money order:
Prepare to use electronic payment methods moving forward.
Next Steps:
We recommend proactively updating your payment modalities with relevant federal agencies in the coming months. For businesses, review your internal processes to accommodate digital-only federal transactions after the effective date.
If you have questions about how this may affect your specific situation, please reach out to our office.