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Sorry Xerox, State Of Pennsylvania Rather Deal With JP Morgan Chase
By Mark Shade
Unemployed to save money with state’s new debit card contract
HARRISBURG — Pennsylvania is replacing a global copier company with a global bank to make unemployment and workers’ compensation payments to people who are jobless or have been injured at work.
State Treasurer Rob McCord said the new three-year contract with JP Morgan Chase will save the commonwealth $5.2 million while improving service to the people who will soon carry the new debit cards.
Pennsylvania previously made unemployment and workers’ comp payments through a contract with Xerox.
McCord said the new agreement will save money because Chase will charge fewer user fees than did Xerox.
“People were charged for not even using the card,” McCord said. “They were charged for simply moving the money to their personal (checking) account, and we thought there has to be a better way.”
The “better way,” he said, is a gold MasterCard with the Chase logo that will replace the blue MasterCard now carried by the unemployed and worker compensated.
The new card will begin arriving in mailboxes in late February or early March, McCord said during a Capitol press conference.
“This is just something that should increase convenience, decrease pollution, decrease costs, et cetera,” McCord said.
The Treasury Department says the new agreement will give people unlimited free transactions wherever MasterCard is accepted; unlimited, free in-network ATM withdrawals; free balance inquiries; unlimited free calls to customer service; and free online bill pay.
The new agreement with Chase also means there will be 25 percent more in-network ATMs for debit-card holders — 3,254 in Pennsylvania and 70,501 in the U.S. — and people will be able to find those ATMs using a mobile app.
However, the cost of an additional replacement debit card will increase from $4 to $5. If a customer needs a replacement card shipped faster, that cost will jump from $12 to $15. McCord said only 2.6 percent of cardholders, or 4,500, request replacements each year.
The treasurer, who began his second term of office this month, said 150,000 Pennsylvanians now carry the old debit card.
Money will stop going onto that card on March 15, but the card will be usable until September, provided there’s a balance.
Officials said 42 percent of unemployment recipients are using the debit card while the rest are getting their money through direct deposit into their checking accounts.
Switching from checks to debit cards will provide savings of its own, McCord said.
“These people, they don’t have a lot of extra money laying around. Getting an extra $5 million into their hands is, we think, a real service to them. In addition to that, we are saving $10-$20 million per year by substituting mailed checks (with) debit cards,” he said.
The treasury department says processing and mailing one compensation check costs about $1.80.
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