14.5.5.2 Direct Express Card

The Direct Express card is a MasterCard-branded prepaid (stored value) debit card that the federal government makes available as an alternative to direct deposit for most federal benefits payments, including Social Security, SSI funds, and VA benefits. It provides a way of protecting the full amount of these benefits from most garnishment orders.

The Treasury Department has entered into a contract with Comerica Bank to automatically disburse Treasury payments onto each card on the payment date.⁵⁴⁹ The funds are loaded electronically and remotely, so beneficiaries need not go into a financial institution, government office, or check cashing outlet to obtain access to their benefits each month.

Benefits paid through the Direct Express card cannot be frozen or garnished, except to the extent that the funds are not exempt under federal law, such as seizure of benefits to pay child support or alimony. In addition, Social Security (but not SSI) payments may be administratively offset, within limits, to satisfy debts owed to the federal government (such as taxes or student loans),⁵⁵⁰ but these administrative offsets are deducted from the payment before it is even made, whether that is by direct deposit, a paper check, or disbursement to the Direct Express card.

The Direct Express card can be used to withdraw cash from ATMs, make purchases at stores that accept MasterCard debit cards, get cash back when purchases are made, or make payments over the telephone or the internet. It can be used to purchase money orders from the U.S. Post Office but cannot be used to write personal checks. Unlike some bank accounts, there are no overdraft fees. The card carries some fees, but they are relatively modest, and recipients can avoid most of them.⁵⁵¹ Signing up is easy.⁵⁵²

The Direct Express card is discussed in more detail in another treatise in this series.⁵⁵³