Check 21 Explained

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What is Check 21?
Check 21 (The Check Clearing for the 21st Century Act) allows banks to replace original paper checks with substitute checks that are made from digital copies of the originals. At YNB we are presently doing just that.

Why was Check 21 created?
Check 21 was created to reduce the time, risks and costs associated with paper check processing.  Checks travel on trains, planes and automobiles during the clearing process.  When Check 21 became effective, banks now can send digital images of checks electronically.  This eliminates the need to physically transport paper checks between banks.  Check 21 also reduces uncontrollable transportation delays that can be caused by weather or natural disasters.

What does Check 21 do?
Check 21 creates a more efficient check processing system, without changing the way consumers write checks.  It simply requires banks and customers to accept paper copies of their original checks called “substitute checks.”

What is a substitute check?
A substitute check is a paper copy of the digital image of your original check-both front and back, with all endorsements-and is about the size of a business check.  Check 21 legislation sets standards for quality and allows for substitute checks to be legal copies of the originals.  All banks must accept the substitute check as they would the original document.

How does Check 21 impact me?
You already receive images of your checks with your statement.  Since you receive an image of your checks, you may  notice a change in their appearance, but you should be aware that there now is less “float time,” particularly for out-of-town checks.  Because check processing is faster with the implementation of Check 21, funds may be removed from your account sooner.  As always, make sure you have enough money in your account before writing a check.