FREE ESSAY ON HOW A CHECK IS PROCESSED

HOW A CHECK IS PROCESSED

Checks are written everyday at almost every place of business. At age 18 anyone with the
adequate amount of money can open a checking account of his or her own. One aspect of
checking account functions that many account owners are not familiar with is the
processing of their checks after they have been written.
When grocery shopping at a place such as Winn Dixie the customer many times thinks to his
or herself whether he or she should pay cash, charge it, or pay for the purchase with a
check. He or she may ponder this question in their mind all the way to the check out
counter. When the customer makes the decision to pay for the merchandise with a check, a
long process is started. This process begins when the check is handed over to the
cashier.
Once all information has been properly placed on the check the cashier then will normally
ask for two things, a home phone number and a drivers license number. Once all of the
necessary information has been placed on the check by both the cashier and the customer
the check is scanned in the automatic check reader. This check reader recognizes the
customers account number, A.B.A. number (or routing number), as well as the check number.
The computer system can then recognize the specific account and check to make sure that
there are no returned checks on that account. Once the checked is approved, it is then
printed or endorsed on the back with all proper information for Winn Dixie deposits,
including the amount of the purchase, cash back received (if applicable), store location
number, date, time, cashier number, and the customer's account number. The cashier then
stores the check in a locked box until it is time for them to go home. All checks are
then added together to make sure none are missing and to make sure the cashier put all
checks in for the correct amount. All checks received in the office at the end of the day
are totaled together and deposited into Winn Dixie's bank account. When the person
responsible goes to the bank and makes the deposit for the business, he or she hands a
large number of checks to the bank teller. The teller will then verify the amount of the
deposit to the total amount of the checks. After the deposit has been verified and all
numbers are correct, the teller will then run the checks through the proof machine to be
verified again. The proof machine also encodes the amount on the bottom right hand corner
of the check. When all of the work has been ran through the proof machine it is then
sorted by an automatic sorter that sorts the checks by their routing numbers. There are
five different categories that checks are sorted into. These five categories are Canadian
items, Treasury checks, items that are drawn on the bank they are processed, items drawn
from the same area in which they are being processed, and items that are drawn from banks
that are not in the area that they are being processed. After the checks have been sorted
they are sent to the bank that they have been drawn on. 
Once the checks arrive at the banks they are drawn on, they are then sorted by their
account numbers. As these checks are being sorted they are posted to the account
automatically. The checks then, in account number order are placed in a safe filing area
so they will not be lost until the bank statements are sent to the account owners. The
check or a copy of the check is then sent to the account owner in the mail with his or
her statement. In the case that a copy of the check is sent to the owner the check is
kept in a safe place until it can be properly destroyed.
This is only one example of the way a check is cleared through a certain business.
Although, the basic concept of check clearing is the same, each individual company may go
through its own processing procedure before depositing the check to the bank. Most banks
handle their checks in approximately the same manner. 
Bibliography
personal interviews.