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Maryland to handle all child support payments electrically

| Feb 1, 2013 | Child Support |

The Maryland Department of Human Resources claims it will save approximately $1.4 million when it begins electronically sending all child support checks to their recipients. The state previously mailed paper checks to custodial parents, but officials with the Child Support Enforcement Administration contend that the new system will save a significant amount on printing and postage, as well as offering a safer, simpler and more efficient way for custodial parents to receive their court-ordered child support.

The state has allowed parents to opt for direct deposit child support payments for a number of years, but the new system will likely see a more widespread adoption of that method. However, the state will also introduce a new Electronic Payment Issuance Card for those custodial parents that do not have bank accounts or choose not to enroll in direct deposit for other reasons. The issuance cards will be distributed to parents by Bank of America and will act much like debit cards; Maryland parents with the issuance cards will be able to withdraw cash from their monthly child support awards by using the cards at any banks, credit unions or ATMs that accept the BOA Visa cards.

The Maryland DHS’s secretary issued a statement praising the new all-electronic payment system, explaining it will allow state officials to better ensure the children depending on child support receive their aid by making the payment process faster and more secure. He added that some recipients would effectively receive more money with each payment, as the new card-based system eliminates that check cashing fees that custodial parents without bank accounts often face.

Maryland has been collecting increasingly large amounts of child support in recent months, typically receiving and disbursing much more than in previous years. For instance, the state saw a collections increase of $25.1 million in the last fiscal year compared to the year before, distributing approximately $544.4 million to parents across the state.

Source: Baltimore Sun, “Md. Eliminates paper checks for child support payments,” Yvonne Wenger, Jan. 23, 2013

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