Check 21 and your checking account

Wow, checking laws have changed the way people cash checks. There ahs been talk about it for a long time and in the last year or so Check 21 has come into being. Check 21 means that your checks may go through and get cleared sooner which could endanger your finances. With this new rule you at more risk to bounce checks and we all know how expensive that can be.

We know it as Check 21 but it is actually called the Check Clearing for the 21st Century Act and it came into actual effect only last year in 2004. This law is all about using computers and the newest technology. Now checks do not need to go through the mail which saves days worth of time. Businesses just need to scan in the image of the check and then send this to the bank. This can be done in minutes whereas the old fashioned way took days and was often held up because of weather.

This is great news for businesses and banks but not necessarily so wonderful for bank customers. You will no longer have that buffer time that people relied on so much. All of this instant transfer stuff can cost us customers hundreds of dollars in bounced checks. So as a customer you will have to make sure that the money is really there when you write the check.

This brand new evolution of the way banking is conducted is all thanks to computers. They have changed so much of the world since their conception why should banking be any different? This is the new age where everything that took days or weeks to do can now be done in split seconds. This new way of banking is simpler, more efficient and much, much cheaper. The overhead that banks and business used to pay has been reduced to a fraction of what it was.

With this new way of using checks you can still send off a regular check but somewhere along the way one of the banks or the business can transfer the check into an electronic image. Once this has been done it is sent along electronically through the proper channels. Some banks and businesses may still want a paper record of this check and if they do they can print off what is called a substitute check. These checks actually state that they are a copy of your check, if they do not say this right on them then they are not a true copy and cannot be used as a substitute check. If you want a copy of your check for your records you can get one of these substitutes. You will not be able to get the original back because it will have been destroyed when the image was made.