Skip to Main Content
The movement toward a cashless society is by no means a new phenomenon. The introduction, in the 1860's, of checks into the monetary system of the United States initiated the transformation of the American monetary system from a “cash-based” community to a cashless society. In fact, it has been estimated recently that over 90% of the total dollar volume of payments made in the United States are made by check.1 Nevertheless, checks, which require multiple handling by banks, are inherently inefficient payment instruments. This inefficiency, combined with the seven percent annual increase in volume of checks processed in the United States,2 threatens the fundamental operations of our payments system. While recent operational developments, such as the introduction of magnetic ink character recognition techniques, provide short-term solutions, there is some question whether the present check-processing system can be sustained in an operationally sound condition beyond the present decade.