![]() Consumer advocates contend that this change could result in millions of bounced checks. This effectively eliminates the "float" time, or the informal grace period of a day or more that now exists between the time a check is written and the time the funds are actually tapped. You could write a check to your dry cleaners in the morning and see the money debited from your account by that afternoon. More important, checks will clear much faster - sometimes in a matter of hours. They can return photo images of the checks instead. The disruption of commercial aviation after the 9/11 terror attacks helped provide the impetus for the new law.Ī: First, banks will not need to return the original checks to customers. Under the current rules, checks must be physically transported to the banks that issued them to be cleared for payment - even if that means flying the checks across the country. The biggest change is that banks will be able to transmit and clear checks by electronic facsimile. Here is a question-and-answer look at how Check 21 might affect your bottom line:Īnswer: It's a financial modernization act that was passed after the 9/11 terrorist attacks. ![]() But consumer groups worry that it could also lead to many more bank customers bouncing checks. Bankers and consumer groups agree that the so-called Check 21 regulations will usher in a new era, but they are sharply divided on whether the changes will help or hurt customers.Ĭheck 21 - short for the Check Clearing for the 21st Century Act - will eliminate check-clearing delays caused by such things as severe weather and terrorism, bankers say. New federal banking rules that become law next month will affect just about everyone with a checkbook.
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