Check 21 Processing

Check21 processing allows electronic conversion of paper checks into a legal, substitute check image for delivery of check information and deposit same-day.

The Check Clearing for the 21st Century Act (Check 21) became effective on October 28, 2004. The purpose of this act was to streamline the current process of negotiating paper checks and other instruments of value between financial institutions. The law actually allows the creating of a new negotiable instrument called a substitute check. This allows capture and processing of the information contained on the check electronically, and delivery of that substitute check to the receiving bank in an electronic format. For the consumer, this means that the substitute check is the legal equivalent of the original check and contains all of the information that was present on the original check.

Currently, most large financial institutions are able to receive or create substitute checks, but not all of the receiving institutions are yet able to do so. At Bill2Pay we have worked closely with our technology partners to integrate both our hardware and software to implement Check 21 and are able to deliver Check 21 files and images.

Despite a lot of media attention, most financial institutions will not be negotiating a large number of checks via the Check 21 processes immediately. Currently, most large financial institutions are able to receive or create the substitute check but many of the receiving institutions are not able to do so. At Bill2Pay we have worked closely with our technology partners to integrate both our hardware and software to implement Check 21 and are now able to deliver Check 21 files and images.

For more information Contact Bill2Pay today.