DEFINITION of 'Electronic Transfer Account - ETA'

A bank account for federal payment recipients who do not have checking or savings accounts. Instead of receiving federal payments by check for Social Security, SSI, the Railroad Retirement Board, OPM retirement, VA benefits, DOL/Black Lung and civilian or military salary or wages, an ETA allows the recipient to receive his or her federal transfer payment by direct deposit, which is considered to be faster, more convenient and more secure than receiving payment by check.

BREAKING DOWN 'Electronic Transfer Account - ETA'

The ETA is a federally insured account and is available through those banks, savings and loans, and credit unions that have registered with the U.S. Treasury as ETA providers. Money can be withdrawn from the account over the counter, at an ATM or through debit card purchases depending on the account terms, but not through check writing. Investment companies, insurance companies and check-cashing companies cannot offer ETAs. Individuals can open an ETA regardless of credit history unless they have previously abused an ETA account.

RELATED TERMS
  1. Checking Account

    A transactional deposit account held at a financial institution ...
  2. Automatic Transfer Service - ATS

    A banking service offered to customers that has both a general ...
  3. Stop Payment

    A request made to a financial institution to cancel a check or ...
  4. Mass Payment

    Mass Payment is a method of paying multiple recipients online ...
  5. Transfer Payment

    1. In the United States, a payment made to individuals by the ...
  6. Certified Check

    A type of check where the issuing bank guarantees the recipient ...
Related Articles
  1. Personal Finance

    Explaining Checking Accounts

    A checking account is an account at a financial institution, usually a bank, that allows for deposits and withdrawals.
  2. Investing

    A Guide to Bank Accounts

    Find out which type of bank account suits your specific needs.
  3. Personal Finance

    How to Cancel a Check

    If you've had a personal check lost or stolen, the next best step is to cancel the check by calling your bank and putting a stop payment on the check.
  4. Personal Finance

    10 Bank Promotions That Pay You To Open An Account

    Find out which banks are running cash promotions this summer.
  5. Small Business

    Best Checking Accounts For Small Businesses

    What you need to know to choose the best checking account for your small business – and where to look.
  6. Tech

    New Bank Account? Don't Be Without These 6 Features

    Certain banking features can make managing your finances easier, so it's important to choose carefully when opening a new checking or savings account.
  7. Financial Advisor

    Where Should I Keep My Down Payment Savings?

    While saving up for a down payment, where should you keep your money. A bank? The stock market? It all depends on your timeline.
  8. Personal Finance

    8 Low-Cost Ways To Transfer Money

    If cost is your primary concern, there are several cheap(er) ways to move funds.
RELATED FAQS
  1. How do you calculate payback period using Excel?

    Understand the various fees that can be assessed on a personal or business checking account, and learn methods to avoid being ... Read Answer >>
  2. For what types of accounts are demand deposits available?

    Learn about the different types of accounts designated as demand deposit accounts, such as savings accounts and money market ... Read Answer >>
  3. How long does it take a check to clear?

    It usually takes two days for a check to clear, but in some cases it may take longer. Discover how banks treat large deposits ... Read Answer >>
  4. What are the differences between preference shares and bonds?

    Learn what information banks keep on file for their customers, and understand how this information can be used to deny an ... Read Answer >>
Trading Center