Philadelphia Fed's Santomero on 21st C banking

Santomero said the law, called Check 21, will help speed the use of electronic checks and payments and help banks save as much as $2 billion on check processing costs. The law is to take effect in October.

But Santomero also said the switch to electronic payments is likely to be a "gradual" one

"It is important the familiar, well-established payment methods be there for them," Santomero told a convention of the New Jersey Bankers Association.

He said Americans still write about 40 billion checks a year -- roughly half of all the noncash transactions in the country.

"So while checks will continue to decline, they will not disappear any time soon," Santomero said.

To read past central bank speeches use our Speech Finder. Click the link on the right.

Speech by Anthony M. Santomero, President of the Federal Reserve Bank of Philadelphia, to the New Jersey Bankers Association 2004 Annual Convention, Aventura, Florida, 27 March 2004.

Banking in the 21st Century