By Lorie Konish

Copyright cnbc

The government is planning to phase out paper checks for most consumers receiving Social Security benefits and other federal payments this month.

The transition is prompted by an executive order signed by President Donald Trump in March, which mandates the move to electronic payments for federal benefits by Sept. 30.

The move is aimed at preventing fraud and reducing spending, according to the Trump administration.

Treasury checks are more likely to be stolen, lost or returned compared to electronic funds transfers, according to the executive order.

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The change may also save the federal government millions of dollars per year, according to the Labor Department. While it costs about 50 cents to issue a paper check, an electronic funds transfer costs less than 15 cents, according to the agency.

Most beneficiaries already receive their payments electronically, according to the Social Security Administration and Department of Veterans Affairs. Fewer than 1% of Social Security beneficiaries receive paper checks, according to a Social Security spokesperson. More than 97% of Veterans Administration benefit payments are delivered electronically, a portion that increases every year, according to press secretary Pete Kasperowicz.