What is a check?
A check is an order to pay given to a bank. It allows the person who receives it to collect the amount of money indicated on the instrument. At the time of cashing a check, the money must be available in the bank account of the person who issued the check. Checks are used as a means of payment, as an alternative to cash.
The types of checks that are electronically cleared are:
- – Regular checks in pesos
- – Deferred payment checks in pesos
- – Certified checks in pesos
- – Financial payment checks in pesos
Deferred payment checks
These are checks that can be issued with a deferred date for payment of up to 360 days from the date of issuance.
They have two different cycles: the registration cycle and the payment cycle.
– The registration cycle is not contemplated in the clearing system, since there is an exchange of instruments between institutions, without any settlement.
– The payment cycle starts after the date for payment indicated on the check. This cycle is similar to clearing a check and the same rules and instructions apply as for regular checks.
Certified checks
Under Sections 48 and 49 of the Law on Checks, banks may certify a check at the request of the drawer or bearer. This certification implies that the bank drawn debits the amount from the corresponding account and earmarks it for an agreed period that cannot exceed 5 banking days.
The advantage of this type of check is that the payee is assured of receiving the funds; in return, the financial institution charges a fee to certify the check.
Financial institutions must indicate the term of the certification, which must be documented through a certification statement.
The certification statement must be delivered to the drawer or bearer of the check, indicating: identification data of the check, date of issue, amount and period for which it is issued.
After the expiration date, a certified check continues to have all the effects of a check (though the funds are no longer reserved).
Financial payment check
Banks and other financial institutions make available the so-called financial payment checks to their customers and the general public.
This type of check is an alternative for people who are not banked or do not have current accounts or credit cards and need to use this payment method.
It is a regular check issued by banks and other financial institutions with the modalities enabled for this type of check. The applicant may fund the check with cash, a transfer to the issuing institution, or an account debit if they are a customer.
The bearer of the check may deposit it in any institution, in which case it is processed by a clearing house against the bank or financial institution account drawn.