This move is not just a headline—it is shaking up the day-to-day operations of over 30 federal agencies. Elon Musk, who now leads the U.S. Department of Government Efficiency (DOGE), made this decision after a wide audit found a lot of waste and fraud tied to these cards.
According to DOGE, here is what the audit uncovered:
- Thousands of credit cards had been inactive for months
- Some were still issued to people no longer working with government programs
- Duplicate or suspicious accounts were flagged
- Many accounts were tied to programs that had already ended
These cards were part of a larger pool of 4.6 million active federal credit cards. And just in the 2024 fiscal year, those cards were used to process nearly $40 billion in federal transactions.
So, if you are wondering why such a huge step was taken, it was mainly about reducing fraud, saving taxpayer money, and stopping wasteful spending.
Which government agencies are most affected by the cancellations?
More than 30 agencies are feeling the heat from this cut, but some are getting hit harder than others. Here are the main groups affected:
- Departments that run social programs and provide public assistance
- Agencies that need credit lines for daily operations
- Federal contractors who rely on these cards for project expenses
Thousands of employees and contractors now find themselves without the operating funds they use daily. Some are scrambling to find new ways to handle travel, logistics, and supplies. And in some departments, this is slowing down basic government services.
How are federal employees and contractors reacting?
This is where it gets personal. A lot of people who work for the government or partner with it are suddenly stuck. They are dealing with project delays, funding confusion, and a lack of access to the resources they need.
Some contractors said they were not given any warning before the cards were deactivated. That alone has caused problems with travel bookings, equipment orders, and emergency expenses.
One employee from a federal housing agency said, “We had to cancel a scheduled visit to a disaster zone because the cards were suddenly inactive. We had no backup.”
The lack of preparation is what many workers are criticizing the most. While some support the goal of cutting waste, they say the rollout could have been handled better.
What other actions has Elon Musk taken under DOGE?
Canceling the credit cards is not the only bold move Musk has made since taking charge of DOGE. He has already introduced other major changes:
- Tighter age verification for Small Business Administration (SBA) loans, after accounts linked to elderly or deceased cardholders were discovered
- Permanent shutdown of the United States Agency for International Development (USAID), saying it failed to meet DOGE’s new efficiency standards
These changes are part of Musk’s larger push to reshape how the federal government spends your money. But they are also sparking debate about whether the speed and style of these reforms are doing more harm than good.
