Feds Ditch Paper Checks: Electronic Payments Rule Proposed
Published Date: 4/29/2026
Proposed Rule
Summary
The government is saying goodbye to paper checks and moving to electronic payments for most federal money transfers, thanks to a new rule inspired by Executive Order 14247. This change affects all federal agencies and anyone who gets paid by the government, making payments faster and safer. Paper checks will only be allowed in rare cases, and the public can share their thoughts by June 15, 2026.
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Analyzed Economic Effects
6 provisions identified: 4 benefits, 2 costs, 0 mixed.
Most Federal Payments Move to Electronic
If you get paid by the federal government, most payments will be made by electronic funds transfer (EFT) instead of a paper check. The rule follows Executive Order 14247 (signed March 25, 2025) and notes Treasury printed 40.9 million checks in fiscal year 2025; paper checks would only be allowed in limited exceptions.
Hardship Waivers Handled by Agencies
If you ask for a hardship waiver to keep receiving a paper check, you will submit that request to the federal agency that pays you instead of to Treasury. The proposed rule says agencies — not Treasury — will adjudicate these individual hardship waivers in a form and manner set by the agency pursuant to Treasury guidance.
New Waiver for Indian Land Infrastructure Gaps
Federal agencies may certify paper checks when payments are made to individuals or entities located on Indian land that lack the infrastructure to support electronic funds transfers. This new waiver category is proposed in response to tribal and agency feedback about technological and banking infrastructure gaps.
Fewer Check Exceptions for Small Businesses
If you are a small business or an individual who receives non-regular, non-recurring federal payments, agencies would generally need to request Treasury approval before issuing a paper check for those payments. The proposed rule moves the waiver for non-regular/non-recurring payments into a category that requires Treasury approval.
Very-Old Age Check Waiver Removed
The rule removes the individual waiver for people born prior to May 1, 1921 (a group that would now be over 104 years old). Treasury proposes eliminating that waiver category because of its very limited applicability.
Prepaid Cards and Digital Wallets Allowed
The rule clarifies that EFT payments can be sent to accounts that meet 31 CFR part 210 requirements, including certain prepaid debit cards and digital wallets. Agencies must allow recipients to provide information for EFT to a bank account, a qualifying prepaid account, or a Treasury-sponsored account.
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