When check cards started to boom in popularity, I was certain that I would never write out a check again. And it’s not just the check cards. As more and more payments are sent electronically, why would we need a piece of paper, the check, to facilitate the exchange?
Fact is, we do need the paper to facilitate the transaction, only now it is used in a completely different fashion. Personal checks are now used to transfer the image to the banker in an electronic form. The new Check Clearing for the 21st Century Act, or Check 21, recently became effective at the end of October.
Check 21, in layman’s terms, is a way for financial institutions to process checks faster. When you used to buy gas at the local station, you would write out a check with your signature and date and they would put it onto their cash drawer and say “thank you.” They would take your check to the bank, and it might take 3-4 days for the money to be transferred from your checking account.
Today, with the implementation of Check 21, the gas station experience changes. When you approach the counter to pay, you will pull out your checkbook, begin to write your check, and the cashier will say, “You don’t have to write that out, just rip it out and hand it to me.”
You’ll be a little confused as they run it through their machine and watch it go around a couple of times. They’ll give it back, voided, and many times it will act as your receipt. Now is the time they will say, “thank you,” and you will go about your day.
Here’s what has happened. The little machine has basically taken an electronic image of your check and sent it to a financial institution. Your check will now be cleared in about 3-4 hours. Much faster than 3-4 days. No longer are the days of floating checks until payday.
Depending on the equipment and service the store subscribes to, they may also be able to check the funds on the spot, and you might have to check your car for some loose change.
On the overall objective, it will make the whole process move much faster and you will still be able to write out checks.
This is good for businesses, like gas stations, which spend their hard earned money trying to track down customers who write out bad checks, extending the cost to the consumer.
As we get accustom to Check 21, you will not even think twice about it. The process will just take some time to get used to, and like anything else, we will adapt, and life will go on around us.
Robb Ksiazek is a successful author and publisher for
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He has researched and written hundreds of articles and can simplify your online search by recommending merchants for the best value and selections in business or personal checks, address labels, rubber stamps and envelopes.
