Where can i cash a substitute check

Substitute checks are copies, normally electronic, of a standard paper check. The enactment of the Check Clearing for the 21st Century Act (The Check 21 Act) on October 28th of 2003 began allowing the U.S. citizens to practice check truncation, a process of extending electronic copies of checks in order to eliminate needs for physical documents for completion of check-clearing.

But, can you cash a substitute check? There are several other things you ought to get familiar with prior to handling your money this way; let us break them down for you.

What is a Substitute Check? (And what it is not)

First and foremost – financial institutions are the only party authorized to create and extend substitute checks. In case of an individual or a business creating paper check images to finalize a deposit, banks that receive the deposit are to extract information from those images to eventually create substitute checks. That said, images and/or photocopies of the check are not legitimate substitute checks.

A converted check is a physical check, written in order to initiate electronic payments. This check is not a legitimate substitute check either.

Who Are Major Users of Substitute Checks?

Substitute checks are generally used by banks to receive funds from the other banks and financial institutions. When writing checks to individuals and businesses, they create no substitute checks themselves. As these are made at the bank, the transaction made with them is, of course, subject to the standard laws of check transactions, not the electronic transfers. There are, however, more rights given to you – we recommend further reading about the Check 21 Act.

How to Identify a Substitute Check?

It is mostly simple to identify one. The phrase ‘This is a legal copy of your check; you can use it the same way as the original check’ indicates one of these. It is normally larger; an image of the original shows in the upper right corner of the substitute check. On the bottom of the substitute check, the bank places the MICR lines identical to the one on the original, except there is a digit 4 number in front of it, indicating the substitute is to be collected.
The image, along with the additional information, can be printed out in order to create an IRD – Image Replacement Document. With an IRD, you can document previously made payments as a substitute for the check you used. When the original, canceled check is not available, this document can be used in order to prove you covered certain expenses.

Check Issuing Service Issues

An immense amount of benefits was brought to banking since the introduction of electronic check extending. The processes are very swift, and cases of fraud are easily brought to your attention. However, there some problems that come with using substitute checks. In case of issuing a check prior to having money in your account, checks are to be cleared faster; float time is not something you can count on, but overdraft fees and bounced checks sure are.
Make sure to balance your account prior to issuing a check.

Substitute checks, being copies, obviously have certain action limits compared to the original check, but just issuing-wise. However, they are fully legitimized by the Check 21 Act and allow normal money-extending.

While sometimes the original checks can be unavailable for use momentarily, substitute checks can certainly be circulated, if they are legitimate. For further reading, we recommend you visit our

As you read about “substitute checks” please keep in mind that we do not currently send any check information electronically. If you receive a “substitute check,” it means somewhere else your check was converted to a “substitute check.” If we receive a “substitute check” drawn on your account, we treat it just like a normal paper check.

Below is important information about your rights regarding “substitute checks.” If you have any questions, please visit one of our offices, or call 800-246-2009 to speak with a branch officer.

What is a substitute check?
To make check processing faster, federal law permits banks to replace original checks with “substitute checks.” These checks are similar in size to original checks with a slightly reduced image of the front and back of the original check.

The front of a substitute check states: “This is a legal copy of your check. You can use it the same way you would use the original check.” You may use a substitute check as proof of payment just like the original check.

Some or all of the checks that you receive back from us may be substitute checks. This notice describes rights you have when you receive substitute checks from us. The rights in this notice do not apply to original checks or to electronic debits to your account. However, you have rights under other laws with respect to those transactions.

What are my rights regarding substitute checks?
In certain cases, federal law provides a special procedure that allows you to request a refund for losses you suffer if a substitute check is posted to your account (for example, if you think that we withdrew the wrong amount from your account or that we withdrew money from your account more than once for the same check). The losses you may attempt to recover under this procedure may include the amount that was withdrawn from your account and fees that were charged as a result of the withdrawal (for example, bounced check fees).

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. If your loss exceeds the amount of the substitute check, you may be able to recover additional amounts under other law.

If you use this procedure, you may receive up to $2,500 of your refund (plus interest if your account earns interest) within 10 business days after we received your claim and the remainder of your refund (plus interest if your account earns interest) not later than 45 calendar days after we received your claim.

We may reverse the refund (including any interest on the refund) if we later are able to demonstrate that the substitute check was correctly posted to your account.

How do I make a claim for a refund?
If you believe that you have suffered a loss relating to a substitute check that you received and that was posted to your account, please contact us at the Electronic Banking Department, The Savings Bank, PO Box 30, Wakefield, MA 01880. You must contact us within 40 calendar days of the date that we mailed (or otherwise delivered by a means to which you agreed) the substitute check in question or the account statement showing that the substitute check was posted to your account, whichever is later.

We will extend this time period if you were not able to make a timely claim because of extraordinary circumstances.

Your claim must include:

• A description of why you have suffered a loss (for example, you think the amount withdrawn was incorrect);
• An estimate of the amount of your loss;
• An explanation of why the substitute check you received is insufficient to confirm that you suffered a loss; and
• A copy of the substitute check and the following information to help us identify the substitute check (for example, the check number, the name of the person to whom you wrote the check, and the amount of the check).

Be careful!
Conveying checks electronically reduces the time it takes for a check you write to someone on the West Coast (or anywhere else in the country) to reach us from days to hours. This effectively eliminates “float” time, making it critical to make sure funds are available in your account to cover checks when you write them.

If you have any questions about Check 21, please visit one of our branches, or call 1-800-246-2009 to speak with a branch officer.

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