Check Clearing for the 21st Century Act became law on October 28, 2004. Known simply as Check 21, the legislation’s goals include “to improve the overall efficiency of the nation’s payments system.” To make check processing faster, federal law permits banks to replace original checks with “substitute checks”. These checks are similar in size to original checks with a slightly reduced image of the front and back of the original check. A substitute check is the legal equivalent of the original check and will include all the information contained on the original. The front of a substitute check states: “This is a legal copy of your check. You can use it the same way you would use the original check.” This includes using a substitute check as proof of payment just like the original check.

By Oct. 28, 2004, every bank was required to accept substitute checks just as they currently accept your paper checks. Along with the electronic images of your cancelled checks that you receive with your account statement now, you may begin seeing substitute check images.

 The improvements brought about through Check 21 allow for faster payment processing and even better service to you, the banking customer. A few of the benefits include:

• Faster Check Clearing

• Decreased Fraud

• Less Paper

• Increased Security

If you have questions about Check 21, please call the Bookkeeping Department at 217-875-3131.