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Effective October 28, 2004, the Check Clearing for the 21st Century Act
will bring the nation's check payment system into the digital age and
allow customers to benefit from better and faster financial services.
Check 21 will improve the speed with which over 40 billion checks a year
are processed in some cases reducing weeks to just days.
How will I benefit?
- Faster Check Clearing - Your bank balance will more accurately
represent your account balance.
- Faster Answers - Check images can be accessed faster to resolve any
questions.
- Fraud Detection - Faster clearing means fraud is detected sooner
giving law enforcement agencies an advantage.
- Security - Check will no longer be physically transported by plane,
train, or truck reducing the number of people with physical contact with
the item.
What is a Substitute Check?
- A substitute check is created when one or more of the banks involved
in the clearing process do not participate in image exchange. It
is a replica of the original check with some additional information.
Here is an example.
- Check 21 makes a substitute check legal for all purposes.
- You may receive a substitute check when requesting a copy.
Other Notes:
- Expedited clearing means you need to have the funds available when
you write your check. "Float" time will be greatly reduced or even
eliminated.
- All banks must accept substitute checks on October 28, 2004.
The law does not require all banks to image checks. This will be
done on an at will basis, however significant savings will ultimately
force most all banks to be "image banks".
- If you have any questions regarding check 21, please contact Linda,
Delores, or Debbie in our bookkeeping department at 217-935-2148 for
assistance.
- Here is a site maintained by the
Federal Reserve
outlining many of the common questions about Check 21?
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