How does a substitute check work?

A substitute check is a special paper copy of the front and back of an original check. It may be slightly larger than the original check. Substitute checks are specially formatted so they can be processed as if they were original checks. You can use it the same way you would use the original check.”

Why would my bank send me a substitute check?

For example, your bank may give you a substitute check if you ask to have a particular canceled check back to prove a payment. Also, your bank might provide a substitute check to you when returning a “bounced” check that you deposited into your account.

Are substitute checks bad?

A substitute check is an image or a copy of an original paper check. 1 Even if banks use electronic images of a check, the copy is a valid form of payment, and is just as good as the paper check itself. You can use it the same way you would use the original check.”

How does remote deposit capture work?

Remote deposit capture works by digitally scanning paper checks and uploading an image of the check to the customer’s bank. While RDC was initially only available to those who had a scanner, it is now widely available to anyone with a smartphone. Customers can deposit checks at any hour and any day of the week.

What are my rights regarding substitute checks?

What are my rights regarding substitute checks? The amount of your refund under this procedure is limited to the amount of your loss or the amount of the substitute check, whichever is less. You also are entitled to interest on the amount of your refund if your account is an interest-bearing account.

Can a bank refuse a substitute check?

Q- Can a customer or business or another bank refuse to accept the “substitute check” as legal proof? A- No! Everyone is required by law to accept the substitute check as valid if it meets all the law’s requirements.

When would a bank use a substitute check?

Substitute checks are copies of an original check which are accepted as legally valid by banks. They were made legal in 2003 by the Check 21 Act, and they are now commonly used for check-clearing purposes. Banks can use photos or photocopies of an original check in order to make a substitute.

Do banks charge for remote deposit?

Remote-deposit fees appear to be uncommon, but at least one big institution, U.S. Bank, charges 50 cents per check. That’s outrageous because digital deposits can be cheaper for banks to process than paper ones.

Is remote deposit capture the same as mobile deposit?

What is Remote Deposit Capture (mobile deposit)? Remote Deposit Capture is a service that allows you to deposit checks into your personal checking account without visiting a branch or ATM. This mobile deposit can be done anywhere with the use of your Smartphone.

How long does a customer have to make a claim that a substitute check was erroneously paid?

To file, consumers should contact their bank as soon as possible and no later than 40 days from the date they receive an erroneous statement or substitute check. A consumer who makes an untimely claim is not entitled to recover losses using the expedited recredit procedure.

Can I Mobile deposit a substitute check?

The Check 21 Act, which was enacted in 2004, authorizes the use of a “substitute check” — an electronic reproduction of the front and back of the original check. As a result, a bank may permit its customers to scan checks and deposit them electronically using the bank’s mobile deposit app.

What features must a substitute check have?

A substitute check is a paper reproduction of an original paper check that must (1) contain an image of the front and back of the original check, (2) bear a Magnetic Ink Character Recognition (MICR) line containing all the information from the original check MICR line, except as provided in industry standards to …