The term check truncation refers to any of a number of arrangements in which the original paper checks are removed from the collection or return process. Currently, under typical check truncation arrangements, electronic information about a truncated check is presented to the bank on which it is drawn rather than the original paper check.
The act facilitates check truncation by creating a new negotiable instrument called a substitute check, which would permit banks to truncate the original checks, to process the check information electronically, and to deliver substitute checks to banks that want to continue receiving paper checks.