VA Benefit Payments Going Paperless

Reprinted from PN April 2011

By March 1, 2013, participants in all benefit plans—including Social Security, military retirement pay, and any other federal system—must choose an electronic option to receive their funds.

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The Department of Treasury recently announced a new rule for recipients of federal benefits, including those who receive any Department of Veterans Affairs (VA) benefit. By March 1, 2013, participants in all benefit plans—including Social Security, military retirement pay, and any other federal system—must choose an electronic option to receive their funds. New beneficiaries will be required to select an electronic payment option.

There are two deadlines regarding this change. The first one affects those applying for federal benefits. Anyone who applies for and is subsequently approved to receive a federal benefit on or after May 1 will receive benefits electronically; there will be no option for a paper check.

For those who already receive federal benefits, including VA benefits, the deadline is March 1, 2013. This is when the Department of Treasury will halt paper check payments altogether. If recipients have not selected one of the electronic options by this date, they will receive a debit card with the benefit amount preloaded on it. Beneficiaries who already have a direct-deposit account will not be affected by this change.

Current beneficiaries who do not already have direct deposit for their benefits or who are interested in the debit card option should contact VA any time after May 1 to apply.

Direct deposit is easy for people who have an existing bank account, or those who are able to open one. Direct deposit is not an option to those who do not have a bank account. VA will require the account type (checking or savings), account number, and bank routing number when you sign up. Once the request is processed, the funds are automatically deposited into your account. Monthly direct deposits are made on the last business day of the month for VA beneficiary recipients. Once the deposit is made, funds are accessible through personal withdrawal, check, or debit card.

The Direct Express Card is a debit card with the amount of your benefit payment pre-loaded on it. If you choose this option, the card and information packet are sent through the mail. The card has no sign-up, monthly account, or overdraft fees. Basically, you can use this card the same way as a regular bank-issued debit card. Free services include:

-Purchases at retail locations and cashback option with the purchases

-Optional notification of deposits to the debit card by phone, e-mail, or text message

-Optional low-balance alert

-Access to the website 24/7

-Unlimited balance inquiries at ATMs, phone, or online

-Access to toll-free customer service 24/7

-Cash withdrawals through bank or credit union tellers

-One free replacement card per year

-One free ATM cash withdrawal per posted de­posit to your account, using an ATM within the card network (information about the network is in the mailed packet)

Additional services not under the “free services” list are also available, for a fee. These are included in the packet sent to recipients and are also on the website (below). Once you opt for a Direct Express Card, you should carefully review all information sent in order to fully understand all the services and fees involved.

Keep in mind that new applicants for benefits have to wait for the usual approval of their claims before they can receive any payments or payment options. Veterans are encouraged to begin looking at the available options to determine which one would be most suited to their lifestyle or needs.

For more information about the electronic payment methods, contact your local PVA national service officer or visit If you already have an account and would like to switch to direct deposit, visit the website or call 800-333-1795.


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VA Benefit Payments Going Paperless


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