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New Federal Law Affects Check “Grace Periods”


CONTACT: Justin Glover
(850) 413-2842
TALLAHASSEE—If you have ever relied on a "grace period" when you write a personal check, you should be aware of a new federal law that now allows your checks to be "cashed" on the spot.
Effective October 28, many Florida banks will begin an electronic check conversion process known as Check 21.  Check 21 is a federal law that allows for the processing of personal checks in real time, which means funds can be immediately accessed from your bank account. 
Electronic check processing is not new to the financial industry but as more banks use Check 21, those on fixed incomes who may have relied on a grace period when paying bills could be impacted.
"Always make sure you have enough money in your account to cover the checks you write at the time you write them," said Tom Gallagher, Florida's Chief Financial Officer.
Here's how it works and what to expect:  Instead of physically moving paper checks, banks will process checks electronically.  An image of the check, both front and back will be sent instantly to the bank where the money will be withdrawn.   That means you may begin to receive a substitute check instead of your original canceled check with your account statement.
Gallagher said Floridians can also tap into advice on managing monthly bills by logging on to
For more information about Check 21, check out the Federal Reserve Board's website at