The U.S. Department of the Treasury’s Bureau of the Fiscal Service announced on January 7, 2020, the selection of Comerica Bank as the financial agent for the Direct Express® prepaid debit card program.

On the same day, a PaymentsSource article, “Comerica Keeps Government’s Prepaid Benefits Card, Balancing Access with Security,” by Kate Fitzgerald, reported the announcement. The article highlights the Direct Express® program’s “challenge [of] balancing the need for making account access easy for a vulnerable population while keeping strong fraud controls.”  This is especially important given the Direct Express® cardholder demographics, for example, “more than half of the cardholders are receiving disability benefits, and 57% subsist solely on payments through Direct Express® ,” according to the article.

Ronda Kent, Assistant Commissioner for Payment Management and Chief Disbursing Officer of the United States, was interviewed for the article, and she said, “Certainly, just as part of any payments system, [some] people are going to have their identities stolen, and that’s covered by Regulation E.”  She went on to say that the unique needs of the cardholder population meant the Direct Express® program is “very conscious that most people using Direct Express® have no alternatives and we have to work very hard to protect their funds.”

In the article, Ms. Kent notes that Direct Express® funds are available in the accounts at 12:01 a.m. on pay day, and that, in appropriate situations, the Government can leverage “same day ACH” in case of emergency.  The article notes that Direct Express® funds are protected from wage garnishment, and cardholders have 90 days, instead of the usual 60 days, to dispute any transactions.

It also points out that Treasury is constantly exploring new technology that could benefit Direct Express®, but, says Ms. Kent, “…its focus is on providing basics,” noting that “[t]he mobile app, for example, currently provides data only about balance status and transactions,” and that Treasury is “reviewing voice-activation technology with Comerica to see if we can add capabilities for Alexa and Siri.”

The full article can be read on the PaymentsSource website (subscription required).