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Check Conversion

Check conversion is a payment that begins with a paper check but ends as an electronic debit. The paper check is truncated/converted into an electronic debit early in the check handling cycle and is processed from then on is processed electronically. Currently checks are converted using ACH payment system or ATM networks. The benefit is to use the efficiencies of electronic payments while still allowing customers to write checks. 

Rules & Regulations
FMS Publishes New Rules for Federal Government Participation in the Automated Clearing House 03/04

• Summary of Rules
• Federal Register 31 CFR Part 210
• New Opt-Out Rule from NACHA

Press Releases 

• Testimony of Louise L. Roseman,
  Director of Division of Reserve Bank Operations and Payment Systems
  Recent developments in the payments system
  Before the Subcommittee on Financial Institutions and Consumer Credit, Committee on Financial Services, U.S. House of Representatives (April 20, 2005)

Publications 

• "When is Your Check Not a Check?" Federal Reserve Board Publication
• Future of the Payments, Check Conversion and other Anomalies (04/03)
• e-Checks Aren't Pilots Anymore (04/02)
  Presentation about the new ACH rules for one time transactions such as Point of Sale, Lockbox, Telephone and Internet.
  Presentation given by Nancy Grant, NACHA and Steve Schutze, ABA
• ABA Comment Letter to NACHA about Rule Enforcement (02/02)
• Final Rule; "Official Staff Interpretation for Regulation E (March 15, 2001)