Social Security's electronic payment system criticized
Last month, I wrote about a big move by the Treasury Department to make all payments from the U.S. government electronically. In the announcement, Office of Management and Budget Director Peter Orszag called the change a "win-win for the American public." Now, we're hearing from others with a different opinion.
Consumer rights groups, including the Consumer Federation of America and Consumers Union, have stepped forward to say that the real winner here could be banks and payday lenders.
The issue at stake is that, while the Social Security Administration says that 83% of all Social Security and SSI beneficiaries receive their benefits by direct deposit, the elimination of paper checks may be forcing the rest into a situation that could put them at risk for expensive payday loans and high fees.