Constituents Expect a Modern Payout System From Government

In today’s economy, governments are under increasing pressure to protect taxpayer dollars from fraud and waste while still meeting public expectations for fast, accessible and secure payments. While the private sector has embraced real-time payment tools, many public disbursements — from tax refunds to critical disaster relief payouts — still rely on traditional methods that can be slow, costly and vulnerable to misuse. The experience of receiving government disbursements can frustrate constituents, strain agency operations and undermine public trust.

Traditional government disbursements, such as paper checks, can take weeks to arrive, are difficult to track, and may be lost or intercepted — creating opportunities for fraud. Even when governments offer ACH direct deposits, constituents are required to share sensitive personal information that many people may not have readily available or feel comfortable sharing. ACH access is also limited to regular business hours, and funds can take days to clear.

Additionally, both checks and ACH require a traditional bank account — leaving out millions of unbanked or underbanked Americans. For families who rely on timely payouts for household cash flow or to pay bills, this unpredictability can have real financial consequences. Ultimately, these limitations are more than just inconvenient; they may erode public trust and strain financial stability.

From the government’s perspective, antiquated payment systems are a significant impediment to efficiency, fiscal responsibility and fraud mitigation. State and local governments collectively spend about $7,708 per person each year on disbursements¹. Mailing a single paper check can cost around $6 — and reissued checks can cost over $21². Inefficiencies such as printing, postage and reissuing lost payments add up quickly, potentially diverting billions of dollars that could be put to better use.

Addressing fraud, waste and inefficiencies requires more than small fixes, it calls for modern infrastructure built for today’s economy. That’s why we’re proud to offer Visa Direct, a real-time* payment solution that can help governments strengthen safeguards against fraud; reduce waste; and enable fast, secure and convenient disbursements to constituents. With Visa Direct, governments can send direct deposits to a constituent’s bank account via their eligible debit card within minutes*. It can replace outdated processes with speed, reach, convenience and security that can reduce cost and strengthen how governments serve their communities.

Unlike many traditional disbursement methods, Visa Direct offers nonstop flexibility, ensuring that direct bank account deposits can be sent and received anytime, not just during banking hours. All that’s needed is the constituent’s debit card number from their bank — no account or routing numbers required. Security protocols such as name and address matching help ensure that payments reach the correct recipients. Visa Direct also facilitates the deposit of funds to reloadable, registered prepaid cards, helping reach constituents without access to traditional bank accounts. Additionally, it can route funds to non-Visa cards and digital wallets, expanding access and flexibility for disbursements.

Visa Direct is built to work with systems governments already use. It maintains transparency and accountability while modernizing the flow of payments without requiring agencies to overhaul their existing safeguards. For the people receiving payments, it can mean fast access to funds when they’re needed most. For the government, it’s a resilient, cost-effective way to meet the moment, and helps reduce fraud and waste.

For government technology leaders and public-sector innovators, this signals a clear call to action: Modernizing payment systems is not just about efficiency, but about delivering on the public’s expectations, reducing administrative burdens, protecting against fraud and ensuring equitable access to government services. By embracing modern payment solutions that are fast, secure, inclusive and cost-effective, governments can enhance service delivery, lower operational costs and better address community needs. Constituents can benefit from fast payments and choice, while government agencies may free up valuable resources to reinvest in essential programs and services. It’s time for government disbursements to catch up with the digital age. Modern payment systems can help build trust, improve equity and streamline the delivery of public services — making government work better for everyone.

[1] Measuring Consumer Satisfaction with Instant Payouts, PYMNTS, November 2023.

[2] The Total Economic Impact™ Of Real-Time Funds Disbursements Vs. Traditional Methods Cost Savings And Business Benefits Enabled By Visa Direct, June 2020

*Actual funds availability depends on U.S. receiving financial institutions.