The chairman of a House Agriculture subcommittee demanded Wednesday that the Treasury Department explain why it allows only banks to bid on contracts for electronic benefit transfer programs.

Rep. Bob Goodlatte, R-Va., said he would send a letter to the administration asking why Transactive Corp., a benefits processing company, is excluded from providing EBT services.

At a hearing of the subcommittee, Transactive president Gregory L. Coler accused the Treasury of "adversely and obtrusively" attempting to eliminate competition between banks and processing companies.

Congress passed a law last spring requiring all federal payments to be made electronically by 1999. To comply, the Treasury and the states are establishing regional EBT networks that will allow welfare and other benefits recipients to access their funds at automated teller machines and point of sale terminals.

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