On October 28, 2004, a law called Check 21 went into effect.  The primary purpose of the Act is to facilitate the broader use of electronic check processing.  The Check 21 Act accomplishes this by authorizing the use of a new negotiable instrument called a substitute check.  A substitute check is a paper reproduction of an original check that contains an image of the front and back of the original check and is suitable for automated processing in the same manner as the original check. 

How will the Check 21 Act affect me?

o       Since you do not receive your original checks back with your statement, you will rarely see a substitute check unless it is a deposit item that has been returned unpaid as a substitute check. 

o       A substitute check is the legal equivalent of the original check. 

o       The checks you write will clear your checking account sooner, so you will need to have available funds in the account when the check is written.

How and when does a check that you write become a substitute check?

o       The bank that creates the substitute check is called the reconverting bank (converting a digital image back to paper document).  Factors considered when deciding whether or not to convert your check to a substitute check include processing and transportation costs, location of banks involved, whether or not an electronic image agreement exists between banks, etc.  There may be times when a check is not converted.

Can you opt out of having any of your checks converted to a substitute check?

o       No...under the Act no institution or any of its clients may “opt out” of Check 21. 

If you have any questions, please contact our Client Service Department at (913) 682-3491 or contact the branch office nearest you. 

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