The news: Early Warnings Services’ Zelle submitted a letter in response to the Treasury Department’s request for information on paperless payment services.

• Zelle wasn’t the only fintech that applied for the role—Plaid and Modern Treasury also submitted letters.
• Legacy providers like Mastercard and Visa also threw their hats in the ring to provide electronic payment solutions.

How we got here: Trump issued Executive Order 14247 on March 25 to do away with paper payment solutions, citing risks like “unnecessary costs, delays, risk of fraud, lost payments, theft, and inefficiencies." 

The order will go into effect on September 30, potentially spurring a need for a new digital payment provider.

Why this makes sense: There are legitimate reasons to divest from paper. 

• Total check volume has fallen 8.7% from 2018 to 2021—and 10.5% annually for consumer-written checks, per the Federal Reserve’s Payments Study. 
• In 2024, the Treasury found it cost over $657 million in taxpayer funds to maintain the infrastructure to use paper records.
• Mail-theft-related check fraud accounted for more than $680 million worth of stolen funds in 2024, per an analysis from FinCEN.

Size of the prize: While just $175 billion in yearly federal disbursements are sent through paper check, per a PYMNTS Intelligence report, that represents less than 2% of all federal payments. 

Winning a new contract with Treasury could open payment providers to dramatically larger payment volume.

Early Warning Services’ pitch: 

• Zelle’s integration within 2,200 financial institutions—accounting for over 82% of American DDAs—means most Americans wouldn’t need to download a new app to receive payments. 
• It cited its 150 million customers and small businesses as a sign of proven inroads into American financial life.
• For unbanked and underbanked customers, Zelle suggested enrolling recipients into Bank On-certified accounts.

Our take: Winning this contract would dramatically boost Zelle’s payment volume, but it faces steep competition from incumbents and other structural roadblocks. 

• Mastercard already has a partnership with the federal government—it sends $50 billion in benefit checks to citizens a year through prepaid cards or digital payments, per Mastercard’s bid letter.
• Almost 20% of US citizens above the age of 65 do not own a smartphone, per a Pew Research study—which is the primary access point for most Zelle users. Older Americans expecting social security checks and other federal disbursements would likely struggle to adopt the technology needed to receive their funds.