Check 21

The Check Clearing for the 21st Century Act, also known as Check 21, was signed into law in October, 2003. Check 21 requires all banks to accept substitute checks as of October 28, 2004. The idea behind Check 21 is to improve the efficiency and reduce the cost of the nationís check collection system.

Check 21 makes it legal for financial institutions to exchange electronic images of your checks instead of the original paper check. When and if it is converted back to paper it is called a substitute check. A substitute check is the legal equivalent of the original check, and is derived from an electronic image of the check.

What does this mean for you?

  • Checks will clear faster, reducing the amount of float time. If you rely on the float time of a check, you may want to change your check-writing habits.

  • If you receive your original checks or images of your checks with your monthly statement, you may start to see substitute checks.

If you have additional questions about Check 21, please do not hesitate to contact us.