Checks and Balances: Changing the U.S. Payments System

摘要

Recent studies by the Federal Reserve show that Americans write approximately 42 billion checks each year. Though declining at about 5% a year, it still represents a lot of paper. Check processing is currently automated based on standards set by the ABA (American Bankers Association) to define the encoding of account information in magnetic ink on the bottom of each check―a system created fifty years ago. A bank or store must transport checks from the place of original deposit to the back-office proof department. There, after the MICR (Magnetic Ink Character Recognition) line is read, the checks are balanced and encoded in magnetic ink with the amount, then sorted and sent out for clearing (if they are transit checks). It's an efficient way to process huge volumes of paper, but it's a dated way to operate.