The bill (S2791) passed Monday (Dec. 22) on a vote of 35 to 1, according to the website of the New Jersey State Legislature. It will now be considered by the State Assembly.
The state payments covered by the bill include unemployment benefits, tax refunds and payroll, according to the text of the bill.
The bill requires that state employees be paid in the form of a paper check if they request it; that claimants of unemployment benefits be given the options of receiving payments via prepaid debit card, direct deposit or paper check; and that taxpayers be given the option of receiving state tax refunds in the form of a paper check, according to the bill’s text.
Currently, unemployment benefits are issued only via prepaid debit card or direct deposit, with no option to receive a paper check, per the bill’s text.
Sen. Kristin Corrado, one of the sponsors of the bill, said in a Monday press release: “New Jersey residents deserve the ability to choose how they receive money that belongs to them. While electronic payments are convenient for most, some residents prefer a paper check for personal reasons. This legislation ensures these individuals have a clear, reliable option, without taking away electronic methods that work well for many others.”
The state’s move is different from what’s happening at the federal level. PYMNTS reported Sept. 30 that the U.S. Treasury now intends to operate almost entirely through electronic channels, with check capacity retained for only narrow exceptions.
This change followed President Donald Trump’s executive order issued in March, “Modernizing Payments To and From America’s Bank Account,” which requires the Treasury and other federal agencies to eliminate paper check issuance and receipt “to the extent required by law” and to rely instead on modern rails such as direct deposit, prepaid cards, real-time payments and digital wallets.
The Federal Reserve is seeking input about the future of its own check services, looking for comment on several paths ranging from maintaining services largely as they are to eliminating check services, PYMNTS reported Dec. 10.
