This chapter prescribes the policies and procedures governing authorized federal entities’ use of Stored Value Cards (SVCs), sometimes known as “smart cards,” to electronically disburse or otherwise transfer funds. It describes:
SVCs subject to this chapter include SVCs issued in programs used to support U.S. government operations domestically and overseas, including "EagleCash®," "EZpay," "Navy Cash®," "Marine Cash®," and other similar programs. Typically, SVCs are used in closed environments.
For additional information about SVCs visit TFM Volume I, Part 4A, Chapter 3000.
An SVC is a smart card capable of storing electronic monetary value on the card’s embedded computer chip. In some cases, an SVC also contains a branded debit card feature to process retail transactions or allow the SVC holder to obtain cash at an automated teller machine (ATM) outside the closed environment of the SVC program. Federal entities may issue SVCs capable of having value added on either a “reloadable” or “non-reloadable” basis. Once issued, federal entities and authorized cardholders may add value to reloadable cards via encrypted hardware devices assigned to a federal entity office or installation. As the SVC cardholder adds value to the card, or spends or transfers the value on the card via SVC hardware devices located at retailers or other SVC program locations, the SVC balance changes reflecting the amount spent or transferred to or from the card’s value.
Treasury, typically in partnership with federal entities such as DOD, provides SVC to federal entities to disburse, transfer, and otherwise manage funds in a variety of closed environments. For example, the Departments of the Army and Air Force, and U.S. Marine Corps use the EZPay SVC to provide recruits at military training sites with a pay advance to purchase supplies and services required during military training at the merchant locations on base. The U.S. military uses EagleCash® at bases around the world as the standard means for deployed soldiers, civilians, and contractors to facilitate the movement of funds to and from an SVC holder’s domestic bank account, convert foreign currency, or otherwise obtain needed funds. The Navy Cash® card service is used to replace coins and currency on-board ships, and, because it is a branded debit card, it allows SVC holders to make purchases at merchants who accept the appropriate network(s)’ PIN-based branded debit cards or obtain cash from ATMs that accept branded debit cards when ashore.
A Treasury-designated agent holds the funds for an SVC program in an account established and maintained by Treasury, sometimes referred to as a “pooled” account or “funds pool.”
Treasury designates financial institutions and Federal Reserve Banks (FRBs) to act as depositaries of public monies and financial or fiscal agents for SVC programs pursuant to 12 U.S.C. §§ 90, 265, 266, 391, 1434, 1464(k), and other applicable laws. Treasury designates depositaries of monies pursuant to 31 U.S.C. § 3303 and 31 CFR Part 202. Treasury-designated financial and fiscal agents may perform reasonable duties as required by Treasury.
Federal entities are required to deposit funds in the Treasury or with a Treasury-designated depositary, pursuant to 31 U.S.C. § 3302(c)(1). See TFM Volume I, Part 5, Chapter 4100, Section 4120. Treasury disburses federal payments pursuant to 31 U.S.C. §§ 3321, 3322, 3327, and 3332.
For terms and definitions related to this chapter, please view the TFM Glossary.
Section 9025—Policy, Benefits, and Use
SVC programs further the Federal Government’s goals to provide timely, efficient, and accurate disbursement and collection services in a secure and convenient way.
To further the goals of the EFT legislation included in the Debt Collection Improvement Act of 1996, federal entities should use SVCs or some other electronic payment mechanism, whenever feasible, to replace or minimize the transfer and disbursement of funds using cash, paper checks, third-party drafts, imprest funds, or other non-electronic payment mechanisms. SVC programs are especially appropriate when alternative electronic mechanisms are not available. They reduce the use of cash and checks in contingency areas of operation where access to on-line commercial payment and collection systems is limited or nonexistent, or can provide an advance of pay to support military training. SVC programs improve a federal entity’s financial controls and cash management capabilities, streamline administrative processes, and provide SVC holders with convenient access to their funds. SVCs may be used to:
A federal entity should contact Treasury (see Contacts below) to discuss whether or not its funds transfer and other financial transaction processes could be improved by using SVCs. If so, Treasury and the federal entity can determine the type of SVC program that would best meet the federal entity’s needs and the needs of the federal entity’s constituents.
Section 9030—Procedures for Federal Entity Implementation of an SVC Program
Each federal entity determines, in consultation with Treasury (see Contacts below), the funds transfer and/or other financial transaction processes for which an SVC program would be appropriate and the type of SVC that would best meet the federal entity’s needs and the needs of the federal entity’s constituents. To implement an SVC program for any of its funds transfer or financial transaction processes, a federal entity must:
Section 9035—SVC Project Manager and Accountable Officers
9035.10—SVC Project Manager
Before implementing an SVC program, the federal entity must designate an SVC project manager.
The SVC project manager must manage the SVC program and the activities described in this chapter in accordance with the:
The SVC project manager:
The federal entity must specifically identify the tasks for which the SVC project manager is responsible in the agreement between Treasury and the federal entity.
9035.20—SVC Accountable Officers
Before implementing an SVC program, the federal entity must designate one or more accountable officers.
The SVC accountable officers must manage the SVC program and the activities described in this chapter in accordance with the:
Specifically, the SVC accountable officers:
The federal entity must specifically identify the tasks for which each accountable officer is responsible. The federal entity should segregate the duties appropriately in accordance with the federal entity’s policies and procedures.
As applicable and appropriate, accountable officers are responsible for the duties and responsibilities of a certifying official or a disbursing official (see TFM Volume I, Part 4A, Chapter 3000), depending upon the designation of the accountable officer, as set forth in 31 U.S.C. §§ 3322 (disbursing officials), 3325 (vouchers), 3528 (certifying officials), and other applicable laws.
Section 9040— Federal Entity and Treasury Responsibilities in Managing an SVC Program
9040.10— Federal Entity Responsibilities
Each federal entity must manage its own participation in a Treasury SVC program in accordance with the requirements of applicable federal law, this chapter, the agreement between Fiscal Service and the federal entity (see section 9030), SVC policies, and other governing documents, for example, SOPs. For any given SVC program, a federal entity may elect to distribute SVCs and PINs directly to its cardholders or, alternatively, may ask Treasury to direct Treasury’s financial or fiscal agent to distribute the SVCs and PINs directly to cardholders, as approved by the federal entity. In managing an SVC program in accordance with the agreement, SVC governing documents, and federal entity-specific procedures, the federal entity:
9040.20— Treasury Responsibilities
Treasury, either directly or through its designated financial or fiscal agent, assists an federal entity with the implementation and operation of the SVC program(s) for the federal entity. In accordance with the agreement and SVC governing documents, Treasury:
9040.30—Security and Internal Controls
The federal entity must establish and implement policies governing security and internal controls with respect to its SVC program in conformance with Government-wide and Treasury policies and procedures. The federal entity must establish and implement controls to protect against:
The federal entity’s procedures must include a process for promptly reporting, and for educating SVC holders on how to promptly report, to Treasury or Treasury’s financial or fiscal agent any loss, theft, or fraudulent or unauthorized use of SVC cards, PINs, passwords, or other security breach or malfunction involving the SVC program.
The federal entity must implement an internal audit process to review and recommend internal controls and safeguards with respect to its SVC program in conformance with Government-wide and the minimum Treasury policies and procedures. Periodically, Treasury and the federal entity review and update the criteria upon which the audit reviews are based.
Each federal entity is responsible for fully funding the SVC funds pool for the total value of SVCs issued or loaded by the federal entity or Treasury’s financial or fiscal agents, in accordance with the agreement between the federal entities or other governing documents (for example, SOPs) for the federal entity’s implementation of the SVC program(s). For value loaded into the SVC program by SVC cardholders at kiosks, the federal entity and Treasury work collaboratively to ensure full collection from the SVC holder (see Section 9030 for information on the MOU).
The federal entity must provide SVC cardholders with all necessary disclosures as required by law, including but not limited to, disclosures required by Regulation E (12 CFR 1005), if applicable, and as provided to the federal entity by Treasury. Among other things, the disclosures address the SVC cardholders’ responsibilities for protecting the SVC and mitigating damages from loss, theft, and fraudulent or unauthorized use of the SVC. The federal entity must obtain the necessary authorizations from the SVC cardholder, must provide any necessary disclosures, and must facilitate the collection of monies owed to the SVC funds pool by the SVC cardholder at any time after activation of the SVC. The federal entity should consult with the federal entity’s legal counsel to determine any federal entity-specific disclosure requirements associated with a particular SVC program. Treasury and its financial or fiscal agent must review any SVC program disclosures or other forms prepared by a federal entity before being disseminated.
9040.60—Residual Funds (Escheat)
Unclaimed balances on an SVC at expiration are identified as residual funds and, if possible, are returned to the cardholder systematically by Treasury’s designated financial or fiscal agent. If systematic return is not possible, the federal entity and Treasury initiate good faith efforts to locate and return residual funds greater than $10 to the authorized SVC cardholder. Should systematic or good faith return not be possible, residual funds greater than one year old are transferred to the Treasury trust fund receipt account “Unclaimed Moneys of Individuals Whose Whereabouts are Unknown” (see 31 U.S.C. § 1322) to be claimed with supporting documentation by contacting Treasury (see Contacts below). Refer to TFM Volume I, Part 6, Chapter 3000, for additional guidance on residual funds.
Section 9050—Accounting Requirements
Treasury, either directly or through its designated financial or fiscal agents, maintains source data to support each SVC transaction and program expense element. Federal entities comply with Treasury’s applicable accounting requirements with respect to the disbursement and transfer of funds in the SVC program. For example, see, TFM Volume I, Part 2, Chapter 3400 regarding requirements for accounting for and reporting on cash held outside of Treasury.
Section 9060—Payment of SVC Program Costs and Fees
Federal entities and Treasury pay SVC program fees and costs as described in the agreement between the federal entities (see Section 9030) or otherwise agreed upon in writing, in accordance with federal laws, regulations, and policies. Generally, the federal entity funds the costs of cards, card readers, hardware and software installation, certain software development, federal entity-specific SA&A, ATO (or other similar process), program deployment, marketing materials, and marketing peripherals. Treasury generally funds settlement, transaction processing, customer service, standard software development, reporting, program management, and Treasury certification and accreditation costs. The federal entity and Treasury will execute an agreement to effect the payment of these costs and fees.
The federal entity will pay these costs and fees to Treasury promptly when due.
Direct inquiries concerning this chapter and stored value card programs to:
Attn: Nadir Isfahani
Bureau of the Fiscal Service
Department of the Treasury
3201 Pennsy Drive, Building E
Landover, MD 20785
For additional information on SVCs, visit the following websites:
For additional guidance for SVC programs used by the U.S. military:
See Department of Defense’s Financial Management Regulation (DoD FMR).
Summary of Updates in this Release
|Summary of Change|
Stored Value Cards (SVCs)
|Added a sentence informing the reader of additional information in TFM Volume I, Part 4A, Chapter 3000.|
Added verbiage and hyperlink redirecting readers to the TFM Glossary.
|All||Changed "agency/ agencies" to "federal entity/ federal entities".|