Unemployment checks will soon be a thing of the past in Tennessee. People will still get their benefits, but instead of a paper check, they’ll have to choose between direct deposit or a debit card from the state.
Department of Labor and Workforce Development spokesman Jeff Hentschel says sending benefits through the postal service leaves too much room for error. Delivery can take too long, and sometimes checks are stolen from people’s mailboxes. And he says those problems are only magnified when the jobless rate hovers around the double digits.
“Unemployment is still very high in the state, we’re dealing with a lot of people who are still on unemployment, but we really would rather not deal with a lot of service issues that we don’t have to to maintain people’s accounts.”
Hentschel says the change will save the state about $3 million a year. And he says it should be an improvement for people who don’t have bank accounts, too, since they won’t have to pay check cashing fees anymore.
The new unemployment debit cards can get cash at any bank with a Visa logo and can be used as a credit card anywhere for free. Using it as a debit card, however, incurs a $0.25 fee per swipe. ATM’s are also a dollar or more per transaction. (The fees are listed here.)
The state is sending out instruction manuals on how to avoid fees altogether. Those fees don’t go to the state. They’re paid to the company operating the debit card service – Chase Bank.
The changes will be rolled out across the state through this month. The last paper check for claimants in Middle Tennessee will come the week of April 18th.
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