New and improved check processing is here
On October 28, 2004, The Check Clearing for the 21st Century Act (Check 21) brings the nation's check payment system into the digital age, with benefits for Northwest Federal members.
Currently, over 40 billion checks a year are transported around the U.S. several times before the payment cycle is completed.
The legislation creating Check 21 now allows financial institutions to create a digital picture of the check you write, which can then be processed electronically. Paper “substitute checks” will be produced from the digital picture of original paper checks (front and back, with all endorsements).
A substitute check contains exactly the information shown on the check you write and is considered an absolute legal equivalent. It retains the legal authenticity of paper checks and meets all state and federal requirements, but with the advantage of increased security.
With Check 21's digital system:
- Your checking account is more secure since your checks will no longer be transported around the country.
- Fraud will be detected, and resolved, faster.
- Checks will clear faster, giving you a more accurate, timely picture of your account.
Note: the implementation of Check 21 means funds to pay a check will be deducted from your checking account sooner than before.
So be sure to keep a sufficient balance in your account at all times to cover check payment.
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