welfare recipients into opening bank accounts. The state aims to get at least 50% of its 70,000 beneficiaries to receive payments by direct deposit. Missouri's bank recruitment effort-perhaps the most aggressive yet articulated by a state-dovetails with financial institutions' desire to open accounts for customers participating in electronic benefits transfer, or EBT, programs. Missouri wants to persuade recipients to enroll with deposit-taking institutions before they receive EBT cards, so they are prepared when checks no longer come in the mail. Cost is a major motivation: Missouri officials say a direct deposit of a welfare payment costs 10 cents, versus 52 cents to cut a check. The federal government has similarly been trying to coax Social Security recipients onto the direct deposit rolls-and a majority of them are complying. Missouri has embarked on an unusual publicity campaign. First, the state treasurer's office compiled a list of 300 banks that offer low-fee accounts. Some of those banks will waive minimum deposit requirements for funds delivered electronically. Then caseworkers began bringing the list to clients, pointing out inexpensive banks in their area. "You have to bring it to the grassroots," said Melba Price, associate director for policy coordination at Missouri's Department of Social Services. "The majority of our clients will see it as an window of opportunity." The state also provided banks with brochures and a toll-free telephone number to enroll new customers. Missouri officials say their initiative is meant to help recipients adjust to federal welfare reform, which requires that people work after getting benefits for two years. "A lot of our clients need to open a checking account-they are going to be getting a paycheck one of these days," Ms. Price said. Having a bank account will allow recipients to "control their finances and establish a credit history," said Gary Glickman, president of Phoenix Planning and Evaluation Ltd., a Rockville, Md.-based consulting firm that has worked with Missouri and other governments. Missouri issued EBT cards in eight rural counties in June, followed by three urban ZIP codes in July. Without providing specific numbers, Ms. Price said the promotions have led to many bank account openings. Three months before getting an EBT card, welfare clients get a notice saying their checks will stop. People receiving cash benefits must choose whether to open a bank account or receive an EBT card-or both. "When we put out information that the check stops, they have to do something different," Ms. Price said. William Phillips, director of American Bankers Association's office of policy development, which has worked with Missouri and other states to reach the unbanked, said there will always be a portion of the population that stays with old habits, such as paying bills with money orders. "Basically they have found out how not to have a bank account," he said.

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