Carole Marks

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TREASURY UNVEILS
Treasury Unveils New Electronic Transfer Account
(ETASM) For Federal Payment Recipients

     It may be hard to believe in this age of technology, but millions of Americans do not have an account of any kind with a bank, savings and loan, or credit union. Most of these "cash consumers," particularly those on fixed incomes, cite cost as one of the main reasons they don't open and maintain an account.
     As our financial world becomes more reliant on electronic transactions, it is increasingly more important for people to have an account at a financial institution, and to learn how to use electronic tools.
      The Federal government is stepping in to help. To make it easier-and more affordable-for cash consumers who receive a Federal payment such as Social Security, the U.S. Treasury Department recently announced the final details of the Electronic Transfer Account (ETA). These accounts are being offered through participating, federally insured financial institutions. The ETA, which will be available later this year, offers a simple, safe and secure way for Federal payment recipients to have access to their funds immediately through electronic funds transfer.
     "Direct Deposit has become an extremely popular way for people to receive their Federal payments because of safety and convenience," states Donald Hammond, Fiscal Assistant Secretary at the U.S. Treasury Department. "However, to take advantage of Direct Deposit a recipient must have a relationship with a financial institution. The ETA is that option for Federal payment recipients who do not currently have an account." Added Hammond, "The ETA addresses the concerns we have heard from cash consumers and community-based organizations about people living on a fixed income and paying the cost of an account."
     The ETA costs no more than $3 a month, and allows at least four cash withdrawals and balance inquiries per month from a teller and/or ATM at the option of the financial institution. The ETA also provides a monthly statement and imposes no minimum balance except as required by law. The ETA is voluntary, and cash consumers can choose to continue receiving their checks by mail if receiving their payment electronically would cause a hardship.
     "The ETA undoubtedly will contribute to bringing the unbanked segment of the population into the financial mainstream," said Richard L. Carri—n, president and chief executive officer for Banco Popular.
     Severo Rodriguez, 57, a Vietnam-era veteran from Texas, says the new ETA will help alleviate his concerns about the high cost of banking.
     "Banks have all these fees and charges," said Rodriguez, who recently started receiving disability payments. "If I ask for my balance, they charge. If I want to see a statement, they charge. This new service that the government is providing is going to help a lot of people, and I do appreciate the opportunity."
     The ETA is available to recipients of Social Security, SSI, Veterans benefits, Federal employee salary and retirement, and Military and Railroad Retirement payments. More information about the ETA will be available this fall