Check 21

Formally, the Check Clearing for the 21st Century Act. It was signed into law on October 28, 2003, and went into effect a year later. Check 21 authorizes any bank to create a “substitute check” from an image of a check and makes it the legal equivalent of the original check.

Under the Check 21 Act, no bank is required to implement imaging, but everyone (bank, business or individual) is required to accept and honor the substitute checks. This cleverly allows image-enabled banks to clear checks between themselves via images, then to create a substitute check only when clearing to or through a non-image-enabled bank.

Tangent can provide Check 21-enabled remittance and check processing solutions, or modify any existing Tangent solution to generate image cash letters. The service-oriented architecture (SOA) of our Deposit21 product, means that it can also be easily integrated with third-party or internally developed payment processing solutions.

Of course, check electronification must be considered in light of various factors, including unit costs, float, labor savings, image quality, physical document destruction and potential liabilities. Contact us and we will help you determine if Check 21 makes sense for you right now.