Check Representment

AAA

DEFINITION of 'Check Representment'

A system wherein a check that bounced or did not clear when it was first presented because the account on which it was written had insufficient funds, is re-presented when sufficient funds are available in the account. In the check representment process, the bounced or returned check is usually converted into an electronic item for representment. Many banks and financial institutions offer check representment services to their business clients at no charge.

INVESTOPEDIA EXPLAINS 'Check Representment'

The benefits of check representment services are manifold. It gives businesses another opportunity to collect payment for products supplied or services rendered, thus reducing the time and expense of going through the collections process or managing bad debts.


Also, the electronic nature of check representment means that repeat offenders with regard to multiple NSF checks can be flagged. This would give businesses advance notice of potential non-payment, and they can therefore insist on 100% advance payment from such clients.


As well, electronic items have an advantage in that they are re-presented more quickly and also receive priority over paper checks. Electronic items also have lower handling costs and much shorter processing times than paper checks.

RELATED TERMS
  1. Bill Presentment

    The submission of a bill of exchange for payment. A bill, such ...
  2. Check

    A written, dated and signed instrument that contains an unconditional ...
  3. Cashier's Check

    A check written by a financial institution on its own funds. ...
  4. Bounced Check

    A slang word for a check that cannot be processed because the ...
  5. Rubber Check

    Another name for a "bounced check." A rubber check is a slang ...
  6. Automatic Bill Payment

    A money transfer scheduled on a predetermined date to pay a recurring ...
RELATED FAQS
  1. No results found.
Related Articles
  1. Savings

    Are Your Bank Deposits Insured?

    Learn how the FDIC is helping to keep your money in your pockets.
  2. Personal Finance

    Using Economic Capital To Determine Risk

    Discover how banks and financial institutions use economic capital to enhance risk management.
  3. Brokers

    Top 7 Biggest Bank Failures

    Many people assumed these giants were too big to fall - they were wrong.
  4. Options & Futures

    Who Backs Up The FDIC?

    The FDIC insures depositors against loss, but what happens if it runs out of money?
  5. Investing

    What's a Debit Note?

    A debit note is a document used by a seller to inform a purchaser of a dollar amount owed. As the name indicates, it is a note from the seller that a debit has been made to the purchaser’s account. ...
  6. Investing

    What's Capitalization?

    Capitalization has different meanings depending on the context.
  7. Savings

    Mortgage Faceoff: Bank of America Vs. Wells Fargo

    Which bank offers the better mortgage deal? Here's how they compare on two popular types of mortgage.
  8. Budgeting

    Best Checking Accounts For College Students

    Student checking accounts avoid the high fees and minimum balances of some other accounts. Here's how to evaluate offers and find one with the best terms.
  9. Entrepreneurship

    Best Checking Accounts For Small Businesses

    What you need to know to choose the best checking account for your small business – and where to look.
  10. Fundamental Analysis

    The Best 5 Online Accounting Systems For Small Business

    Running a small business can be difficult, but thanks to these online accounting services, taking care of payroll doesn't have to be.

You May Also Like

Hot Definitions
  1. Prepaid Expense

    A type of asset that arises on a balance sheet as a result of business making payments for goods and services to be received ...
  2. Gordon Growth Model

    A model for determining the intrinsic value of a stock, based on a future series of dividends that grow at a constant rate. ...
  3. Cost Accounting

    A type of accounting process that aims to capture a company's costs of production by assessing the input costs of each step ...
  4. Law Of Supply

    A microeconomic law stating that, all other factors being equal, as the price of a good or service increases, the quantity ...
  5. Investment Grade

    A rating that indicates that a municipal or corporate bond has a relatively low risk of default. Bond rating firms, such ...
  6. Fringe Benefits

    A collection of various benefits provided by an employer, which are exempt from taxation as long as certain conditions are ...
Trading Center