Alabama's "Check 21" Law

Starting in October, 2004, the State of Alabama put into effect what has become known as the "Check 21" law. Under this law, banks can use electronic check processing efficiences that will save the banks billions of dollars. The Alabama consumer needs to BEWARE! Under the new law, checks drawn against an account will clear faster, possibly in hours rather than days. But, banks are under no obligation to process checks that consumers deposit into their accounts any faster.

Put simply, under "Check 21" banks will make more money...on overdraft fees! It's been estimated that by mid 2005, Alabama consumers might be bouncing almost 7,000,000 more checks than they do now, and paying up to $170,000,000 in bounced check fees each month.

With "Check 21", consumers must be more careful than ever when using checks. Excessive bounced can easily plunge people deep into debt problems even though most bounced checks are not intentional.