Recent changes undergone by the unemployment benefits distribution system in the state of Missouri has given rise to worries regarding hidden costs which laid-off workers might incur due to the implementation of a new debit card scheme.

The complaints came as state authorities set in place a paperless unemployment claims distribution system which involves checks being automatically deposited in workers’ bank accounts and loaded onto a debit card which can then be used at selected ATM machines.

However, some of beneficiaries of the new debit card scheme were not thrilled with the new arrangements. One of the main complaints is that the new system does not come with a built-in opt-in clause. When laid-off workers file their jobless claim requests, they are not asked whether they want to sign up for the new debit card system, but are automatically enrolled unless they specifically chose to opt out.

Other complaints have to do with the fact that while purchases are free, as are cash withdrawals done at Central Bank ATMs (Central Bank being in charge of the new debit card program), a USD1.50 fee is charged when withdrawals are made from other ATMs. Central Bank also charges for lost cards and for transactions performed at banks which don’t belong to its own network. The contract between the state and Central Bank also allows the latter to increase its fees in later years – yet another cause for some laid-off workers’ discontent.

In response to these complaints, Missouri state authorities have pointed out that the new paperless unemployment benefits distribution scheme allows them to save USD 600,000 on postage fees and is a lot more secure than the traditional check system.