|
|
By: Marcy Cauthon, AAP, APRP, NCP, Director, On-Demand Education
|
Has the payments industry seen a decline in check processing volume? Absolutely! However, did you know that there are still billions of checks flowing through the check network each year? There has been a major shift in check operations over the last 15 years, as the industry has seen many seasoned check personnel exiting financial institutions and a newer generation coming in to replace them. And this new generation coming on board may have never seen a paper check, written a paper check or received a paper check as payment.
While most check processing has moved from paper checks to electronic checks (images), the attributes on a paper check are still important when detecting a fraudulent item and determining whether the check is negotiable. Paper check processing does still happen in financial institutions today (via a capture process) and it is important for staff to understand what your institution is liable for and how to handle exception items properly.
Did you know that checks follow several different rules, laws and regulations? UCC 3 & 4 define what a check is and the required fields for negotiability. This is where you find all the check warranties and indemnities that explain which entity is responsible in a fraudulent check situation. Does your financial institution train tellers to look for certain characteristics and proper endorsement when they are presented with a paper check? Many tellers have not been properly trained to look at a paper check when it is presented. They just scan the check and move on. However, check training fundamentals are still key in today’s environment as checks continue to be returned for missing or improper endorsement or for fraudulent reasons (item is altered or counterfeit).
Regulation CC covers funds availability and how returns should be handled. Regulation J and Operating Circular 3 (OC3) cover check processing through the Federal Reserve Bank. As you can see, there are several places to look for answers when dealing with checks.
It's essential that financial institutions train employees on the ins and outs of checks. Even with a decline in usage, checks are an important staple in the payments industry. And, they aren’t going away any time soon.
If you have check newbies on staff or you simply want a refresher on the basics, check out Check Day Camp! This two-day event (three hours each day) virtual event starts with basic check terminology and the legal framework surrounding checks and check processing.
After covering the basics, Check Day Camp takes a deeper dive into check warranties and indemnities and the commonly used return reason codes and Federal Reserve Bank adjustment investigation types. Attendees then take their knowledge and work through check exception scenarios to determine the best course of action.
If you are wondering whether you or a staff member should attend this event, let’s test your knowledge. Do you know:
- What the check return timeframe is?
- What the four different endorsements are called?
- Which financial institution warrants a check is not altered or counterfeit?
- What adjustment investigation type you can use for a duplicate check?
- Which return reason code to use when an item has exceeded the allotted times of presentment?
If you don’t know the answers to these questions, or the answers are a little fuzzy, Check Day Camp is the place for you! Even if you are seasoned in checks or an NCP (National Check Professional), this is a great fresher class to earn 3.6 NCP continuing education credits.
The industry has been saying for quite some time that checks are going away. Like I said before, the volume has decreased but they are still a staple form of payment.
Register now!
|
|
Check Day Camp isn't right for you? Consider inviting a friend or
employee who may be the right fit!
Or, if you need a to go over the basics or want a refresher on checks,
consider joining us for ACH Day Camp!
|