90 million of the $ 1,400 stimulus checks are now available via direct deposit
ljubaphoto | E + | Getty Images
Approximately 90 million Americans now have these $ 1,400 stimulus checks on their bank accounts.
The recipients are part of the first wave of payments, which totaled more than $ 242 billion, the Treasury Department, IRS and Bureau of the Fiscal Service said on Wednesday. Additional payments will be made in the coming weeks.
Wednesday marks the official “payday” on which the first check was deposited. The funds were made available to account holders by 9 a.m. local time.
More from Personal Finance:
Here’s who qualifies for the new $ 1,400 stimulus checks
New economic checks of $ 1,400 could be garnished for unpaid debts
Why Americans Paid Over $ 66 Million To Cash Initial Stimulus Checks
Recipients of this first tranche include those who provided direct deposit information on their 2019 or 2020 tax returns or who submitted their information via the IRS non-filer tool in the past year.
Most of the stimulus payments will be made by direct deposit, according to the IRS. The government has also sent around 150,000 checks valued at approximately $ 442 million.
If you don’t see the money right away, it could arrive in the coming weeks.
Why Some Earlier Received $ 1,400 In Payments
President Joe Biden gave the government permission to mail the checks when he signed the US bailout plan last Thursday.
Some Americans saw the money go through their accounts ahead of the official payment date on Wednesday.
The IRS announced Friday that it would start sending the money.
“Some Americans may view the direct deposit payments as pending or provisional payments in their accounts prior to the official March 17th payment date,” the IRS said in its statement.
Some organizations like Chime, a start-up for fintech banks, have decided to make the funds available to their customers early on. This led some people to wonder why other traditional banks hadn’t done the same.
Understanding why some payments were made early while others didn’t fall until March 17 depends in part on what is known as the ACH network and how it works.
The ACH network is a payment system that enables direct deposits and payments to accounts at US banks and credit unions nationwide.
It’s no mystery where the money is from when the first payment file was submitted on Friday March 12th to when all recipients have access to the money on Wednesday – it’s still with the government.
Organization that monitors the ACH network
Every ACH payment or direct deposit order has a corresponding date, according to the National Automated Clearing House Association or Nacha, the organization that oversees the ACH network.
On March 17th, two things happened. The funds went from the US government to banks and credit unions. Then the banks and credit unions had a deadline by which to make the funds available for people to withdraw (usually 9 a.m. local time).
All payments made in advance meant that these financial institutions advanced the money based on instructions they received about who to pay how much.
“It’s no mystery where the money is from when the first payment file was submitted on Friday March 12th to when all recipients will have access to the money on Wednesday – it still rests with the government “said the organization.
According to the Consumer Bankers Association, there is usually a standard waiting period of at least two days before accounts are charged for these types of transactions. This gives the government time to correct potential errors. In addition, institutions can resolve potential cases of fraud.
Consequently, financial institutions that advance the funds earlier do so at their own risk.
Subsequent payment rounds will also take place via an ACH billing, which is scheduled every Wednesday after the payments are made, according to the finance department.
If these funds fail, the government will reissue the payments as checks. Other payments sent by post are also made using debit cards.