MINNEAPOLIS -- Nearly half of all checks written today are consumer to business, according to a recently released study by the Federal Reserve.
The report wraps up the Fed's 2007 three-part payments study, which can be found on the Fed's website (http://www.frbservices.org). The first two studies, on depository institutions payments and electronic payments, were released in December 2007.
Remittance payments are the most common use of checks. Though 2.6 billion checks were converted and cleared as ACH payments in 2006--an eight-fold increase over 2003--the study also found that 42% of checks sampled were ineligible for ACH conversion under current National Automated Clearinghouse Association rules. Reasons included missing or no signature, amounts that exceed maximums and checks from businesses and government.
"The findings of the Fed's check sample study are intended to help the Federal Reserve, the industry and the public better understand how checks are being used and inform future payments investment decisions," said Richard Oliver, executive vice president of the Federal Reserve Bank of Atlanta and the Federal Reserve Banks' product manager for retail payments.
--heathercutimes@gmail.com
