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Article: Check 21 and the migration to electronic payments.(SELECTED TOPIC)(rules for banking system)
- Article from:
- Business Credit
- Article date:
- March 1, 2006
- Author:
CopyrightCOPYRIGHT 2006 National Association of Credit Management. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
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The implementation of Check 21 legislation in the fourth quarter of 2004 further accelerated the migration from paper to electronic payments. At the time, it was estimated that banking institutions would need to invest in the front-, middle-, and back-office infrastructures with total industry costs exceeding $10 billion over the course of the decade. The increasing migration also raised risks to banks as businesses became better able to gain benefit from changes and in turn better able to collect funds. The acceleration of collection has had potential negative consequences on bank revenues from deposits and payment products.
The objective of the Check 21 ...