What is an ETA Account?

Electronic Transfer Account (ETA) is a bank account designed by the United States Treasury Department Treasury for recipients of Federal Benefits payments as a low cost option for them to receiving their government benefit payments by direct deposit.

The account was designed after the federal government made it a requirement that all recipients of social security or any federal government benefits program switch to Direct Deposit by March 1, 2013. That means that the government was no longer mailing paper checks to anyone. This presented seniors or those receiving benefits with two options as the video below shows. You either get your money through direct deposit or sign up for a direct express debit card account which is also managed by the Treasury Department through an agreement with Comerica Bank.

There is a third option that many people don’t know about, and that is the Electronic Transfer Account. This is a way to get your federal benefits electronically to comply with the law but at a fraction of what it may cost you to use a traditional bank account (checking or savings) or use the direct express debit card. The ETA account is not like a traditional bank account because it has several limitations when compared to a traditional bank account. For the most part, all you can do with it is to receive the federal government benefit and then take out cash.

To open an ETA account, you need to first find a participating bank, contact the bank and the open the account directly with them. Once that process is complete, you can then contact the social security administration or the federal benefits administrator for the benefits you are getting and sign up for direct deposit as show in the image below.


Click here to open an ETA Account.

One of the greatest benefit of the ETA account is that the account fee the bank can charge you cannot be more than $3. That is a big deal and why some people have chosen to use this program to get their federal benefits. Best of all, your ETA account is federally insured.

Complaints about Social Security Checks

It used to be that the millions of people on social security and supplemental security income benefits will relieve a physical check each month via the United State Postal Service (USPS). There was several problems with millions of people receiving checks from the government each month. First, it cost the government a lot of money to print and Mail these checks each month and not all the checks make it to the recipients. Which means that they have to spend more money to reissue new checks, hoping the reissued checks will make it to their actual destination successfully. That was not the only issue with checks.
"social security check"
Recipients who did not get their checks have to endure expensive overdraft fees if bills that were scheduled in anticipation of the check arriving that did not make it. Social security recipients are mostly on fixed income so a delay in their checks or checks gone missing. That puts extra strain on them and brings unnecessary financial hardships that they don’t need.

In addition, those who are unbanked have to pay expensive check cashing fees to cash their checks which could be as high as $30 on some cases. For fixed income recipients, that’s an undue burden. Then you have a case where some of the checks were being stolen and cashed by thieves. Can you imagine getting your social security check stolen and then you have to call the social security administration about a check you did not receive only to find out it was stolen and illegally cashed by someone? Then you have to wait for them to investigate to confirm that you did not indeed cash the check before they reissue you another one. What a nightmare.

That’s why the decision by congress to pass a law requiring that all government benefit payments be made by electronic transfer was a great decision because it has several benefits. Apart from the cost savings the government will get from not having to issue paper checks, there are several benefits to the recipients themselves. First, they get their benefits payments on time, avoiding any overdraft fees that might be incurred due to checks or bills mailed in anticipation of an on time social security check. Then there is no risk of people stealing the checks or it going missing and causing further financial strain an people who are mostly dependent on their social security checks for all their monthly expenses.