As the U.S. government tries to soften the blow of the coronavirus and prepares to send $1,200 to millions of Americans, fintech CEOs have stormed Twitter with messages for lawmakers.
“The technology exists to get money to most people today (even to those without bank accounts). Square and many of our peers can get it done. US government: let us help,” Square CEO Jack Dorsey said on March 26. Twenty minutes later, Plaid CEO Zach Perret chimed in, “Let fintech help.” Payroll processing company Gusto spoke up the next day, writing, “We’re urging the U.S. government to partner with payroll platforms so we can create an instant pipeline to get relief funds to small businesses—within 24 hours.”
Fintech companies have built fast, nimble systems for moving money. But the reality of how these government partnerships might work is much more complicated and requires a close look at the details.
For the stimulus checks, Treasury Secretary Mnuchin has said anyone who has set up direct deposit with the IRS for a past tax return—eight out of ten American taxpayers have done this—will get the $1,200 direct-deposited. The money will start shipping in three weeks, the IRS and Treasury say. From Dorsey’s tweet, it sounds like Square or PayPal could do it even faster.
For consumers who don’t have a bank account on file with the IRS—about 28 million Americans—they could get mailed a paper check, which might take months. If those people set up a Cash App account, they could receive their money faster, says Marqeta’s Jason Gardner.