DENVER, Feb 10, 2003 (BUSINESS WIRE) -- U.S. Bank (NYSE:USB) and the State of
Colorado are introducing an innovative payment program that allows the state to
disperse child support payments on a plastic card versus a paper check.
The Family Support Registry or FSR Card functions like a debit card though it is
not attached to a checking or savings account. The state collects court ordered
payments as it has in the past, but instead of cutting a check and mailing it to
the recipient it electronically loads the payment on to the FSR Card that the
recipient can use to make purchases or withdraw cash. The card carries the Visa
logo so it is accepted anywhere that Visa is accepted.
The program is the first of its kind in the United States. It's an innovation
that cuts costs for the state because it no longer has to produce and mail a
check, and it brings convenience and safety to the cardholders who no longer
have to find the time and place to cash their checks or pay check cashing fees.
"For many years we've been searching for a safe, reliable, and inexpensive way
to deliver child support payments electronically to parents who don't have bank
accounts. It appears we've found it in this card, and it is only a matter of
time before many other government agencies pick up on it to deliver their
payments," said Craig Goellner, systems director for the State of Colorado.
Since the program began as a pilot in 2001, it has become a recognized and
valued instrument by more than 1,200 recipients in Colorado. The results were so
impressive that the state is now making it available to all parents who receive
child support checks. "Parents have told us they love the card. Our experience
during the pilot bears this out in that we have had very few cancellations. It
looks to us like a win-win for all."
Parents have also said that the card helps them enter the mainstream financial
world by allowing them to make purchases wherever Visa is accepted. Cardholders
can track child support funds and spending separately from other funds through
monthly statements or by free, 24-hour access via the Internet or telephone. In
addition, merchants such as grocers who have traditionally cashed child support
checks for customers no longer risk encountering check fraud.
The card is available to the recipient free of charge. They only fee they incur
is if they withdraw funds from an ATM, in which case there is a $1.50 fee. If
the card is lost or stolen, it is backed by Visa's zero liability policy, which
means the cardholder is not responsible for unauthorized purchases.
"Creation of this pre-paid card for delivering payments to our parents who
receive child support is public sector/private sector collaboration at its
best," Goellner said. "I couldn't be more pleased with the teamwork we've
enjoyed working with U.S. Bank to build and test this card."
"We are very excited to have jointly developed a product that provides more
options to the custodial parents in Colorado as well as making the Family
Support Registry a more efficient division within the state government," said
Matthew Roan, vice president of commercial banking for U.S. Bank. "The end
result was truly an effort of both U.S. Bank and FSR working together to provide
more convenience to the custodial parents of Colorado."
U.S. Bank implemented a similar pilot in the State of Washington and is working
with other government agencies to initiate stored value payment cards in more
states and in various capacities.
U.S. Bancorp, with assets in excess of $180 billion, is the 8th largest
financial services holding company in the United States. The company operates
2,142 banking offices and 4,604 ATMs, and provides a comprehensive line of
banking, brokerage, insurance, investment, mortgage, trust and payment services
products to consumers, businesses and institutions. U.S. Bancorp is home of the
Five Star Service Guarantee which assures customers of certain key banking
benefits and services or customers will be paid for their inconvenience. U.S.
Bancorp is the parent company of U.S. Bank. Visit U.S. Bancorp on the web at
CONTACT: U.S. Bank
Teri Charest, 612/303-0732
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SOURCE: U.S. Bank