Electronic distribution of public assistance benefits: System performance and stakeholder opinions

Several states have conducted pilot projects to test the feasibility of using electronic banking techniques to deliver public assistance benefits. These systems establish electronic account balances which recipients access through the use of a debit card at terminals such as bank automatic teller machines or transaction authorization machines like those that validate credit card charges. The present study examines the first test of a comprehensive electronic benefit transfer (EBT) system for multiple benefit programs, a pilot project for cash and food stamp programs conducted by the state of Maryland in the city of Baltimore. Surveys examined the issues perceived by the three primary sets of stakeholders: 1. representatives of government, including social service workers (n = 47) and key state personnel; 2. two-thirds of the participating retailers (n = 110; and 3. benefit recipients (n = 882). All stakeholder groups were generally favorable regarding EBT. However, some subgroups were less favorable: small store operators were less favorable than larger ones and cash recipients were more favorable than food stamp participants. Understanding these opinions requires a closer examination of the meaning and use of public assistance programs by all participants.