The Internal Revenue Service and the Treasury Department are beginning to send nearly 4 million economic impact payments by prepaid debit card, instead of by paper check or direct deposit.
The IRS had trouble with some direct deposits because it was relying on information from taxpayers’ 2018 and 2019 tax returns, and in some cases the money went to temporary bank accounts set up by tax prep chains. Paper checks are starting to go out, but they take longer. The prepaid debit cards promise to provide more convenience, but if they get lost in the mail, that could pose problems as well for people eagerly awaiting their economic impact payments.
Horacio Mendez is the president and chief executive officer of the Chicago-based Woodstock Institute, a 52-year-old research and policy institute focused on economic security and financial systems evolution for low- and moderate-income individuals and communities.
Karun is a seasoned technology-focused professional with global IT industry experience in the insurance, pensions, and investment management sector. He has extensive experience in managing customer relationships, large-scale technology projects, platform selection & implementations and consulting engagements, and building and leading top-performing teams servicing users globally.
His research focuses on insurance technology trends and solutions for the EMEA region across P&C and L&H lines of business, as well as covering the London market.
Before joining Celent, Karun had spent 22 years with Tata Consultancy Services (TCS), where he contributed to expanding its insurance portfolio in Europe. Karun has a significant track record in winning, retaining & executing large multi-million global IT contracts for TCS, complete solution & cost ownership, and advising customers on their strategic initiatives. He brings a deep understanding of insurance technologies. Early in his career, Karun worked in the manufacturing and supply chain management domain and led consulting assignments on IT strategy and Enterprise Architecture.
Karun keeps track of changing technologies and business models in the financial service industry and regularly attends seminars and conferences. Karun has also published articles on emerging technologies such as quantum computing and crypto/blockchain. He has a bachelor's degree in Electronics and Communication Engineering from Calicut University and Certification in Fintech from Said Business school at Oxford University.
Karun lives in Cambridge, the United Kingdom, with his wife, daughter, and son.
The Treasury said recipients can use the so-called EIP Cards to make purchases, get cash from in-network ATMs, and transfer funds to their personal bank account without incurring any fees. They can also check their card balance online, by mobile app, or by phone without incurring fees. The EIP Card can be used online, at ATMs, or at any retail location where Visa is accepted. The free, prepaid card comes with the kinds of consumer protections available to traditional bank account owners, including safeguards against fraud, loss and other problems.
“Treasury and the IRS have been working with unprecedented speed to issue Economic Impact Payments to American families,” said Treasury Secretary Steven T. Mnuchin in a statement Monday. “Prepaid debit cards are secure, easy to use, and allow us to deliver Americans their money quickly. Recipients can immediately activate and use the cards safely.”
Under the $2 trillion CARES Act that Congress passed in March in response to the economic fallout from the coronavirus pandemic, the IRS and the Treasury have been sending out payments of $1,200 to individual taxpayers, $2,400 to couples, plus an extra $500 for each of their dependent children.
The Treasury said it has already sent more than 140 million economic impact payments worth $239 billion to Americans by direct deposit to accounts at financial institutions, Direct Express card accounts, and by check. The Treasury-sponsored EIP Card is another way to distribute the money efficiently and securely to eligible recipients and their families. EIP Cards are being sent to qualified individuals who don’t have bank information on file with the IRS, and whose tax return was processed by either the Andover or Austin IRS Service Center.
The Treasury’s financial agent, MetaBank, will mail out the EIP Cards to eligible recipients starting this week. Each mailing will include instructions on how to activate and use the card.
The EIP Card is part of the Treasury’s larger U.S. Debit Card program, which offers prepaid debit card services to federal agencies for electronic delivery of non-benefit payments. MetaBank was picked as the Treasury’s financial agent for the U.S. Debit Card program in 2016, after a competitive selection process by the Treasury’s Bureau of the Fiscal Service.
For more information about the EIP Card, click here. For more details about economic impact payments, click here.
