On March 25, 2025, the president of the United States signed an Executive Order mandating the Federal government to modernize how it makes and receives payments. The goal is to replace paper checks with digital methods to help increase payment security and reduce costs. While there is no immediate impact to the payments industry as a whole, government mandates have historically trickled down to influence changes.
As mandates can happen quickly, organizations must act rather than wait.
Here, we provide additional details regarding the mandate and offer tips on how you can prepare before the changes go any further.
What Does the Executive Order Entail?
Per the fact sheet released by The White House, the Executive Order mandates the Federal government to refrain from issuing paper checks for disbursements. Disbursements can include:
- Vendor payments
- Benefit payments
- Tax refunds
The mandate is expected to take effect on September 30, 2025.
The Order also includes payments made to the Federal government, though the requirements will differ in these scenarios.
- Fees
- Fines
- Loans
- Taxes
Checks have ever-increasingly been targets of fraud, with over 680,000 Bank Secrecy Act (BSA) filings received in 2022 alone. Replacing paper checks with digital methods – including ACH, credit/debit cards, and digital wallets – offers an immediate security boost to payments.
Why Now Is the Time to Switch
Forcing digital payments signals a big step towards modernizing dated processes. Unless your organization takes or makes the above-mentioned Government payments, you likely are unimpacted... for now.
However, that doesn’t mean organizations should wait to digitize until required! Other industries will likely begin to implement similar mandates.
Establishing a digital payments program for accounts payable (AP) and accounts receivable (AR) payment purposes is essential to ensuring a consistent payment experience.
Vendor payments can easily be replaced with virtual cards and ACH, expediting time to payment and maximizing payment security. Additionally, supporting credit cards and ACH from B2B customers 24/7 via a secure online portal exponentially increases the efficiency and convenience of payments.
Taking on a digital transformation can be time-consuming. Here are a few factors to consider when planning your digital strategy.
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Research – given how many payment providers there are, it can take significant time to research which has the best solutions for your organization. Depending on the verticals you support, you may have specific requirements that only certain providers can help with. And, of course, pricing always plays a part. This type of research, along with demos and meetings, can consume significant amounts of time and require buy-in from various stakeholders.
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Implementation – you’ve found the perfect provider. How long will it be until you can start digital payments? Implementation periods vary across providers. Implementing digital payments can take months depending on customization, integration requirements, design, testing, documentation, and marketing. The process may also require dedicated resources tied up with other initiatives.
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Support – once digital payments are live, training and educational sessions must be provided so AP and AR clerks can easily follow the new processes. Training is often not a one-time occurrence, and as other potential changes approach the payments horizon, having payment solutions adaptable to new mandates is essential. This is why ongoing support from your payments partner should be a long-term commitment.
Another benefit of modernizing sooner rather than later is cost and time savings. Automated electronic payments reduce the costs typically associated with paper checks, while expediting the time to payment and keeping them on time. More on-time payments lessen late fees and keep B2B relationships strong.
The First Step
The first step towards digital transformation begins inside your organization. Assess current AP and AR processes to see where digital enhancements could be needed. Make a list of needs and priorities, and start researching payment providers who can tick items off your list. The proper payments provider will fit seamlessly within your existing workflows.
One Provider for All Payments
REPAY is dedicated to simplifying and optimizing AP and AR processes. Our platform automates outbound vendor payments and streamlines B2B payment acceptance.
Through our nearly 300 existing integrations, a payments program can be set up in only a few days. You can take advantage of digital payments faster than ever, even if you need customization. Our security tools, including positive pay, ACH validation, PCI compliance, tokenization/encryption, and more, ensure every B2B payment is protected.
If further mandates make their way down the payments pipeline, our technology is flexible to help you quickly pivot.
Please don’t wait until it is too late to swap out paper checks. REPAY is ready to assist today!