Number: RL32668
Title: Electronic Banking: The Implementation of the Check 21 Act
Authors: Walter W. Eubanks, Government and Finance Division 
Abstract: This report begins with a brief background of the check truncation issue, including a brief legislative history of the Check 21 Act. The next section discusses what Check 21 does and does not do. Next, it discusses the key rules and procedures of the Feds final regulations. These rules range from the provisions governing the substitute check to the expedited recredit for consumers and banks. The report also examines consumer protection provisions that were incorporated in the law and those that were left out. The section on banks adopting electronic check clearing suggests that the costs will slow adoption, and the conclusion suggests that Check 21 is not likely to reduce paper check clearing significantly in the short run. Other methods of electronic payments, however, will reduce paper check clearing more rapidly.
Pages: 10
Date: November 9, 2004