Georgia Public Policy Foundation (GPPF), a free-market think
tank based in Atlanta, has called on the state government to
adopt prepaid cards as the primary method for the payment of
unemployment benefits, where paper cheques and direct deposit into
a bank account are the only ways to receive the benefit.
The foundation argued that the migration would benefit both
beneficiaries and taxpayers.
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“Georgia allows state employees and people receiving child
support to accept payments on a prepaid card. It’s time to expand
access. In a state where so many are without a bank account and the
unemployment rate is 9.1%, we should strive to deliver services in
a way that doesn’t needlessly burden those most impacted by the
recent recession and weak economic recovery,” Kelly McCutchen GPPF
president and CEO, said in an article published on The Atlanta
Journal-Constitution on May 9.
According to McCutchen, 12.2% of the Georgian population is
unbanked. More than 9% of Georgia’s almost 10m inhabitants are
unemployed and the Government has just approved a cut in the
unemployment benefit from 26 to 14 weeks.
He argued that the government and taxpayers would also gain
benefits from the migration to prepaid cards thanks to the
reduction of costs and inefficiencies related to issuing paper
unemployment cheques.
Other states that have moved to prepaid card benefit payments,
such as Mississipi, have seen such gains already, said
McCutchen.
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By GlobalData“The cost of issuing paper cheques compared with the cost of
depositing money on a prepaid card is approximately $1 versus 10
cents”, he said.
“Ninety percent of Mississippi residents receiving unemployment
benefits [on prepaid cards] were able to access the funds at least
two days earlier than if they had been paid by cheque. They also no
longer had to pay cheque-cashing fees or worry about carrying cash
around,” added McCutchen.
