When is Check 21 effective?

The Check 21 Act is effective October 28, 2004.  At this time banks may elect to begin sending or receiving check images in lieu of the original check.  All banks will be required to accept substitute checks at that time.  As of this date, you may begin receiving actual substitute checks or seeing images of substitute checks on your imaged account statement.

What is a substitute check?

A substitute check is a new negotiable instrument that is a paper reproduction derived from a digital image of your original check.  The substitute check contains an image of the front and back of the original check and contains all original payee and bank endorsements and audit trails.  A properly prepared substitute check is the legal equivalent of the original check for all purposes.

Will the substitute check look just like my original check?

It will have the same appearance as the check you originally wrote, but it will have additional information on it that banks will use in their check clearing processes.  It will also bear the language:  "This is a legal copy of your check.  You can use it the same way you would use the original check."

Will all of my checks become substitute checks?

Not necessarily.  Check 21 does not mandate electronic check processing by banks; it just makes it possible.  The effects of Check 21 will most likely happen very gradually.

What happens to my original check?

If a financial institution digitizes your original check, that financial institution is responsible for the retention and eventual destruction of your original check.  There are no requirements governing the retention of the original checks.  Typically original checks will be destroyed some time after the original is digitized.  As mandated by the Act, substitute checks are legal substitutes for proof of payment.

Additional information from the Federal Reserve.