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Thursday, June 09, 2011

Treasury Direct Deposit Requirement for Veterans

To provide federal beneficiaries with a safer and more convenient alternative to receiving payments via paper checks, the Department of Treasury is encouraging all Department of Veterans Affairs (VA), Social Security Administration, and Railroad Retirement Board beneficiaries to elect electronic payment for recurring benefits. The Treasury will begin contacting new beneficiaries after May 1, 2011, and all beneficiaries after March 1, 2013 to encourage enrollment.

Beneficiaries are encouraged to provide VA with their local bank account information in order to enroll in the Direct Deposit program. Beneficiaries without bank accounts may enroll in the Direct Express debit card program with Comerica Bank. Payments will be directly deposited into that account and made accessible through a debit card that is mailed by Comerica Bank to the beneficiary's home address. Personal funds cannot be transferred into this account as it can only be used to receive Federal benefits.

Department of Treasury's Financial Management Service Division selected Comerica Bank as its banking agent to issue the debit cards. Comerica was selected in part because of its years of experience with card services for state government benefit recipients and its lower charges compared to other popular banks. The following are some of the advantages of the debit card program:

  1. The Direct Express debit card offers beneficiaries the opportunity to receive their payments electronically even if they do not have a bank account.
  2. Cardholders have 24/7 access to their money at automated teller machines (ATMs) and are able to make purchases at any retailer that accepts MasterCard.
  3. Cardholders can access their account information by telephone and Internet, make purchases over the Internet, and receive cash back with no fee at retail locations.
  4. Debit cards eliminate the cost of cashing a check.
  5. Debit cards are a safe and reliable means of receiving a payment.

For additional information on the Direct Express program, please visit GoDirect at


Beneficiaries receiving benefit payments by check or those who have just become eligible to begin receiving benefit payments have two choices for electronic payments:

  • Option 1 Receive payments by Direct Deposit through the financial institution of the beneficiary's choice.
    • The federal government makes payments electronically through a program called Direct Deposit. Direct Deposit is a safe, convenient, and reliable way to receive federal payments through a financial institution.
    • If a beneficiary chooses to receive payments by Direct Deposit, he or she needs to designate a financial institution (e.g. a local bank) through which the payment may be made and then notify and update VA with his or her Direct Deposit account information by calling 1-800-827-1000.
  • Option 2 Receive compensation and pension payments via Direct Express Debit MasterCard program, a prepaid card program established as an alternative to Direct Deposit.
  • The Direct Express card is a MasterCard debit card issued by Comerica Bank. There are no fees to sign-up for, or activate, the card; receive deposits; make purchases at retail locations, online or by telephone; get cash at retail locations and financial institutions; or check the card's balance at an ATM, by telephone or online. Additionally there are no fees for declined transactions and overdrafts. For additional information or to enroll in the program, please go to: GoDirect or call the GoDirect Help Line at 1-800-333-1795.

Beneficiaries should select an option from above and take immediate action. A local bank may provide you with greater flexibility, lower fees, and convenient access to ATM's. If the beneficiary elects the Direct Express option during application, VBA will establish an account for the beneficiary with Comerica Bank and send his/her recurring benefit payments via the Direct Express Debit MasterCard described in Option 2. If beneficiaries do not elect one of the above options, they will be contacted directly by the Department of the Treasury regarding the importance of enrollment as well as the process to request a waiver from this program.

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