What is the difference between Check 21 and programs that convert checks to electronic payments?
A check you write may be processed as a check. In that case, your rights are governed by check laws and regulations. Some merchants, however, may use your check as a source of information to create an electronic fund transfer. You must receive notice that your check may be processed this way. Electronic fund transfers are governed by different laws and have different consumer rights than check payments. For more information, see the brochure When Is Your Check Not a Check: Electronic Check Conversion published by the Federal Reserve Board.
A check you write may be processed as a check. In that case, your rights are governed by check laws and regulations. Under electronic check conversion, the check is used only as a source of information to create an electronic fund transfer and is not processed as a check. You must receive notice that your check may be processed this way. Electronic fund transfers are governed by different laws and have different consumer rights than check payments. For more information about electronic check conversion, see the brochure “When Is Your Check Not a Check: Electronic Check Conversion” published by the Federal Reserve Board.
A check you write may be processed as a physical check, as it has for many years. In some cases it may be converted to an image as Check 21 allows. In either scenario Check 21 allows the image of the check to act in place of the paper item. In this case, your rights are governed by check laws and regulations.
