| Check 21 reduces check clearing time
from days to hours. You cannot rely on float anymore.
Starting October 28, 2004, the Check 21 law helps
financial institutions send checks electronically to each other, by
"truncating" the movement of paper checks by converting them to electronic
files This is something that most credit unions have been doing for years,
but banks are only starting to do.
Check 21 allows any financial institution that doesn't
want to receive a check in electronic form to request a paper copy of the
electronic check. This converted paper check is called a "substitute check."
A substitute check is more than a photocopy or paper image of the original
check—it's required to meet strict standards to qualify as the legal
equivalent of the original check.
Your can learn more about Check 21 by contacting your
local credit union. |
