Cherry Blossoms

Electronic Transfer Account

Frequently Asked Questions

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What is an ETASM?

An ETA is a low-cost account that is made available by participating federally insured financial institutions to you if you receive federal benefit, wage, salary, or retirement payments.

The account allows you as a recipient to receive federal payments electronically in accordance with the Electronic Funds Transfer (EFT) provision of the Debt Collection Improvement Act of 1996 (DCIA).

The DCIA requires that federal payments, except for tax refunds and except where waived by the Secretary of the Treasury, be made electronically after January 1, 1999.

Financial institutions that choose to offer ETA enter into an ETA Financial Agency Agreement with the Department of the Treasury (Treasury). The agreement outlines the duties of financial institutions designated as Financial Agents and ensures compliance with the ETA standards.

Who is eligible to open an ETA?

If you receive a federal benefit, wage, salary, or retirement payment, you are eligible to open an ETA. Examples of types of payments that qualify you to open an ETA include:

  1. all civilian (federal employees) wage and salary payments,
  2. all military wage and salary payments,
  3. Social Security,
  4. Supplemental Security Income,
  5. Black Lung,
  6. Railroad Retirement Board Retirement and Annuity,
  7. Department of Veterans Affairs Compensation, Pension, and Educational Benefits,
  8. Thrift savings distributions, and
  9. any retirement payments made by the Office of Personnel Management or any other federal agency.

What account features are included in the ETA?

As described in the Notice of ETA Features, dated July 16, 1999 ("ETA Notice"), Treasury has determined that the ETA will:

  • be an individually owned account at a federally insured financial institution;
  • accept electronic federal benefit, wage, salary, and retirement payments and such other deposits as a financial institution agrees to permit;
  • be subject to a maximum price of $3.00 per month;
  • have a minimum of four cash withdrawals and four balance inquiries per month, to be included in the monthly fee, through any combination of proprietary automated teller machine (ATM) transactions and/or over-the-counter transactions;
  • provide the same consumer protections that are available to other account holders at the financial institution;
  • allow access to the financial institution's on-line point-of-sale (POS) network, if any;
  • require no minimum balance, except as required by federal or state law;
  • at the option of the financial institution, be either an interest-bearing or non-interest-bearing account; and
  • provide a monthly statement.

What types of deposits can be made to the ETA?

A financial institution can accept to the ETA electronic deposits of federal benefit, wage, salary, and retirement payments or, at its option, allow other deposits in addition to electronic federal benefit, wage, salary, and retirement payments.

A financial institution may choose to limit any additional deposits to electronic deposits or may allow recipients to deposit checks and/or cash.

Financial institutions may specify whether deposits of other funds may be made by mail, at an ATM, and/or over-the-counter.

Financial institutions are not permitted to charge any fee for deposits of other funds.

Can recipients who have opened an ETA switch to a traditional checking or savings account and receive their payment by Direct Deposit?

Recipients are able to switch at any time to a traditional checking or savings account and receive their payment by Direct Deposit and are encouraged to do so if a checking or savings account better meets their needs.

Treasury considers the ETA to be an important stepping-stone to more full service banking relationships while providing a safe, reliable, and low-cost alternative to recipients who currently receive their federal payments by check.

When did ETAs become available to recipients?

ETAs became available in September, 1999. If a financial institution chooses to offer the ETA, it must first enter into an ETA Financial Agency Agreement with Treasury.

After being designated an ETA provider, a financial institution may begin offering the ETA to eligible recipients

Will the ETA be able to support electronic state benefits?

In addition to the electronic deposit of eligible federal payments, financial institutions have the option to allow other deposits to an ETA, including state cash benefits.

If the financial institution allows additional electronic deposits to the ETA, state benefits can be deposited to the ETA as long as the state agrees to make these payments electronically, and the recipient authorizes the electronic deposit.

What choices are available to a recipient who receives state-administered benefits in addition to federal benefits?

Recipients of both federal and state-administered benefits may choose to receive their state-administered benefits through a State Electronic Benefits Transfer program, if available, and receive their federal benefits through Direct Deposit to a traditional checking or savings account or an ETA.

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