Executive Order 14247, signed on March 25, 2025, is a transformative step toward fully modernizing how the federal government handles payments. The goal is simple but impactful: move away from paper-based transactions into a digital-first model for disbursements (payments out) and receipts (payments in).
This change marks a significant shift in the federal government’s financial interactions with individuals, businesses, and other agencies.
Why This Matters: Cost, Speed, Security
Paper checks and money orders are not just outdated—they’re expensive, slow, and increasingly risky.
- In FY 2024, maintaining the infrastructure to handle paper payments cost taxpayers $657 million.
- Treasury checks are 16x more likely to be lost, stolen, or tampered with compared to electronic payments.
- Mail theft and fraud have surged since the COVID-19 pandemic, creating vulnerabilities for benefit recipients, taxpayers, and agencies.
The government’s initiative aims to eliminate these inefficiencies by mandating electronic payment methods across all federal agencies, wherever legally permissible.
What’s Changing (and When)
By September 30, 2025, the Department of the Treasury will stop issuing paper checks for all federal payments, including:
- Social Security and other benefits
- Tax refunds
- Vendor payments
- Intragovernmental transfers
All agencies must transition to electronic funds transfer (EFT) methods like direct deposit, prepaid debit cards, and other modern digital options. The government will also begin phasing out paper-based methods of receiving money—such as lockbox services—for fees, fines, taxes, and loans.
Protecting Access and Equity
While this shift is about modernization and efficiency, it doesn’t overlook the challenges faced by specific populations.
The Treasury Department will grant exceptions for individuals or situations where digital payments are not feasible, such as:
- People without access to banking services
- Certain emergency or hardship cases
- National security and law enforcement activities
Alternative options will be provided in these cases, ensuring no one is left behind.
What to Expect Next
We encourage all taxpayers, even those with exceptions, to prepare for electronic payments. Several options are available, including the Electronic Federal Tax Payment System (EFTPS) and IRS Direct Pay.
Final Thoughts
This order will lead to a faster, safer, and more cost-effective federal payments system. As we transition to a digital economy, this transformation aims to ensure that the government’s financial infrastructure keeps pace, with efficiency, equity, and security as core principles.
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