Check Clearing For The 21st Century Act (Check 21)

Check Clearing For The 21st Century Act (Check 21),

Definition of Check Clearing For The 21st Century Act (Check 21):

  1. The Check Clearing for the 21st Century Act (Check 21) is a federal law that took effect on October 28, 2004. It gives banks and other organizations the ability to create electronic images of consumers' checks in a process known as check truncation. The images are then sent to the relevant financial institutions to be processed, where money from a consumer's account is transferred to the receiving party's account. The electronic copy of the original check is known as a substitute check.

  2. A law enacted in 2004 which gives banking institutions the right to process checks electronically. The new processing structure allows banks to reduce transportation costs associated with paper check processing.

  3. The Check Clearing for the 21st Century Act (Check 21) aims to make use of technology to reduce or eliminate the costs involved with paper check processing. For example, the cost of physically transporting a paper check from one part of the country to another is far higher than the delivery of an image of a check across a secure network.

How to use Check Clearing For The 21st Century Act (Check 21) in a sentence?

  1. It gives banks and other organizations the ability to create electronic images of consumers' checks; the images are then sent to the relevant financial institutions to be processed, where money from a consumer's account is transferred to the receiving party's account.
  2. Check 21 is distinct from the act of using an electronic copy of a check to make a deposit into a bank account; this process is known as remote deposit.
  3. The Check Clearing for the 21st Century Act (Check 21) is a federal law that took effect on October 28, 2004.

Meaning of Check Clearing For The 21st Century Act (Check 21) & Check Clearing For The 21st Century Act (Check 21) Definition