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TreasuryDirect E-Commerce

By Ron Lewis

Christmas 1998 was indeed merry -- and memorable -- for administrators of the U.S. Treasury Departmentís TreasuryDirect investment program.

In the wee hours of the morning on Saturday, Dec. 26, while brokers and bankers and the rest of the nation were sleeping, an investor in Brooklyn, N.Y., acting without anyone elseís help or knowledge, reinvested a $20,000 Treasury bill.

Why was that so significant?

It was the one millionth time a TreasuryDirect customer had made a reinvestment electronically -- via the Internet or phone -- a convenient, self-service option that didnít exist just a year and a half earlier.

For those who run the program, the investment was an accomplishment worth celebrating. For outsiders in related businesses, it is a landmark worth considering. Through an aggressive and expanding array of e-commerce services, TreasuryDirect is helping to redefine customer convenience and set new standards for operational efficiency.

Administered by the Treasury Departmentís Bureau of the Public Debt, TreasuryDirect is a book-entry securities system in which buyers of Treasury bills, notes, and bonds establish and maintain accounts directly with the U.S. Treasury. For a decade following the programís start in 1986, customer transactions were performed on ink and paper; then, in late 1997, officials began implementing what they thought must be a better way to do business. The first service to go electronic was reinvestments. They were offered on the toll-free phone line in August 1997 and were introduced on the Internet in June 1998.

At the same time reinvestments went on the web, Public Debt began offering on the Internet three conveniences it had implemented on the phone in February 1998; these services enable investors to check their account balances as well as order statements of account and duplicate 1099-INT tax forms. Finally, in September 1998, the Buy Direct initiative gave TreasuryDirect customers the option of purchasing securities on the web and phone.

The sum of it all is this: today, with a few clicks of a mouse or with the dialing of a toll-free phone number, TreasuryDirect customers not only can buy Treasury bills, notes, and bonds from the comfort and security of their homes and offices, but can perform in the same simple manner many of the routine functions needed to maintain their accounts. Those arenít the only benefits. On the back end of the equation, the governmentís processing of these transactions requires less manpower than ever. Computers do the bulk of the work.

Still in their infancy, TreasuryDirect Electronic Services enjoy wonderful popularity. Those one million reinvestments in 16 months equal more than 2,000 per day. Also, though investors who participated in a recent survey expressed reluctance to buy securities over the Internet or phone, the fact is that more people buy TreasuryDirect products through electronic means than by visiting any of the countryís 36 Federal Reserve Banks.

Indeed, TreasuryDirect is more direct than ever before.

About the Author

Ron Lewis is with the Bureau of the Public Debt, U.S. Department of the Treasury. You may reach him at

January 1999