Check Clearing Enters the 21st Century
The Check Clearing for
the 21st Century Act (Check 21) was signed into law on October
28, 2003, with an effective date of October 28, 2004.
The new law allows for "substitute checks", which are printed
images of the front and back of the original check. These
substitute checks have the same legal status as the original
paper check and are processed in the same way.
With approximately 42 billion checks written in the United
States each year, financial institutions are embracing check
imaging as a way to reduce transportation and processing costs
and make check clearing a more efficient process.
Below are some frequently asked questions on "Check 21".
Remember, if you still have any questions, you may contact us at
1-740-743-1349.
What is Check 21?
Short for Check Clearing for the 21st Century Act; it is a new
federal law passed by Congress to improve check collections
among financial institutions. Checks will no longer need to be
physically transferred from one location to another during their
processing. Under the new law, check clearing will become a more
streamlined, efficient process.
When will the Check 21 Act become effective?
This law will be in effect on October 28, 2004. From this date
on, you may start to receive substitute checks.
What is a substitute check?
A substitute check is an electronic image of your original paper
checks; you will be able to see the front and backs of your
checks. Substitute checks are legal copies of your original
checks. You can use the substitute check the same way you would
use the original check, it is a legal copy.
How will Check 21 affect me?
Check 21 allows for checks to be cleared faster. This means that
the time between when you write a check and when the check is
cashed will be reduced. The "float" time will be dramatically
decreased, so it is important to make sure you have sufficient
funds in your checking account to cover your checks.
Whom do I contact if I have more questions on Check 21?
If you have questions about the Check Clearing for the 21st
Century Act please contact our member contact center at
1-888-786-2791.
For more information you may also visit the links below:
The above links are provided for your convenience. Commodore
Bank is not responsible for the content of third party sites
accessed via hyperlinks from this web site, nor does it
guarantee the products or services offered on third party sites. |
