Electronic And Digital Checks: Everything You Need To Know About The New Regime

Within the list of payment instruments provided, securities are - without a doubt - one of the most used in our country, and especially within these, checks. The check has been consolidated as an instrument that provides trust and security, not only because of the legal protection it enjoys (which allows for rapid collection and, if necessary, access to an agile means of judicial execution), but also for allowing payment to be deferred and/or ease of movement.

Traditionally, the “Check Law” (No. 14,412) provided for checks to circulate - and be canceled - essentially on paper, identified as a card or physical check.

However, with the promulgation of Law No. 20,038, regulated by Circular No. 2436 of the Central Bank of Uruguay, two new categories are introduced: (i) the electronic check and (ii) the digital check.

  • Electronic check: it is created, circulated and canceled electronically, using the advanced electronic signature as a signature.
  • Digital check: it is created as a card or physical check and, after its creation, it is digitized through a scan for the purposes of deposit and collection, transforming the check into a digitized image.

A. Main aspects introduced by the new regulations.

1. Advanced electronic signature is provided for electronic checks. In this way, the signature of the issuer (issuer) of the check may be handwritten or electronic, depending on whether the check is card-based or electronic.

2. Advanced electronic signature is supported for endorsements.

3. Changes are introduced with respect to the collection of checks: in addition to the traditional method of depositing the physical check directly in the Bank, the possibility of doing so is now also foreseen by sending to the receiving Bank the digitized image of an originally paper check. /physical.

4. It is anticipated that, in the case of electronic or digitized checks, the Bank must provide the holder of the check with a certificate of rejection, establishing in turn the minimum content that it must contain.

It may be issued both in paper format (and signed with the handwritten signature of the authorized person of the receiving Bank), and in digital format (and must be signed by the authorized personnel of the receiving Bank using the advanced electronic signature). It must be issued in the format that the check holder chooses.

5. The digital and electronic check is incorporated into the list of executive titles (which enable the holder to resort to a more agile judicial process for its collection), the proof of rejection issued by the Bank being sufficient.

6. The Institute for Clearing and “Check Truncation” is established, enabling electronic clearing between different banks when the check:

(a) had not been issued for payment by the Bank in which it is deposited; either

(b) the client authorized to receive the deposit did not have an account in the Bank that must proceed with the payment.

In that case, the Bank receiving the check must send its digitized image to the entity that must proceed with the payment.

7. The requirement that checks (whether cardboard or not) must have reactive inks (ultraviolet light) is eliminated, with their inclusion in the design now being optional .

However, it is established that information patterns specific to each Bank must be included, to facilitate the detection of attempted falsifications and/or adulterations.

8. It is established that both the check card and the digitalized physical document must be preserved and safeguarded for a minimum period of 6 months , counted from the expiration of the presentation period for collection.

The digitized image of the check must also be kept for a minimum of 6 months, but counted from its capture.

It is important to keep in mind that any of these deadlines will be suspended until a final ruling is issued when:

(i) the issuer (drawer) of the check had initiated legal action after its payment, or

(ii) the holder of the check would have taken legal action following the Bank's rejection of payment.

In both cases, it is the responsibility of the plaintiff to inform the receiving Bank about the initiation of legal actions.

9. Finally, it is authorized that the digitized images may be kept in custody by entities even other than the receiving Bank. However, the Bank will always maintain its final responsibility for custody.


B. News regarding the services of Financial Intermediation Institutions (“Institutions”).

1. A new service is added: it is expected that Institutions can implement mechanisms that allow the submission of the digitized image of the cashier's check for presentation for collection.

In these hypotheses, the digital image may replace the physical document (as long as it is captured under the conditions established by the BCU).

It is important to note that this new mechanism would be an additional service, and does not imply in any way that the receiving Bank is empowered to stop offering the traditional collection presentation channels.

2. The Institutions receiving the checks must contractually establish with their clients the conditions for providing the decentralized check digitization service.

This may be done by incorporating these conditions into the existing contract, or by celebrating a specific one for this operation).

The standard specifically establishes some elements, deadlines and conditions for sending the physical document to the receiving Bank, and (iv) claims attention process.

Likewise, it is anticipated that the client must expressly indicate that they will assume the civil and criminal liability of the depositary while the physical document is in their custody.

In turn, the receiving Bank may agree that the client safeguards the digitalized physical document at its own expense and order. However, the receiving Bank will retain responsibility for the custody of the digitized document during the legal retention period.

Finally, the regulations establish that the contract must be available to the BCU, who may require its modification if abusive, unclear, inaccurate or insufficient clauses are detected in the information provided.

3. Institutions must have a risk policy that is clear, transparent and accessible regarding this type of operations.

4. The regulations also define the responsibilities of the Bank receiving the checks, among which the following stand out:

(i) request its clients, as appropriate, to send the physical documents of the digitized checks, when they have not sent them within the contractually agreed period, and

(ii) issue check rejection certificates in accordance with applicable regulations.

5. The obligations and requirements for the implementation of digitalized checks are foreseen and regulated, highlighting those that deal with:

(i) the capture of images, not accepting the use and sending of a previously generated image;

(ii) the use and transmission of these instruments to the receiving Bank, ensuring compliance with applicable international standards;

(iii) the forms of proof of non-use of the cash register check, to avoid the circulation of the same security in different formats.


C. Final reflections.

The introduction of the electronic and digital check at the national level represents many positive changes, the main one being undoubtedly the -increasing- simplification of payment processes, based on principles that seek to guarantee the security and efficiency of the technology, without giving up the protection they provide. legal instruments to “traditional mechanisms”.

Do you want more information?

This question is for testing whether or not you are a human visitor and to prevent automated spam submissions.