It happens to all of us at one time or another. We "bounce" a check. Which means the financial institution has refused to pay the check because there were insufficient funds in the account when it arrived at the financial institution for payment. Financial institutions refer to these checks as "NSF (for non-sufficient funds) returned checks" and they are a labor intensive and costly transaction for financial institutions and merchants to handle.

And they are costly for you---you're likely to pay a returned check fee to your financial institution and the merchant may charge you a fee for receiving the returned check. And to make matters worse, it's embarrassing! Most of the time you would have to appear in person to make good on the check and in some cases your account is reported to check verification companies, preventing you from writing additional checks at other stores until the "bad check" is cleared up.

Now there's a new way for retail merchants, billing companies and financial institutions to process NSF checks. The company can now collect an NSF check using the same system that is used for Direct Deposit. This means that instead of trying to re-deposit the paper check or call you on the phone to make good on it, the company simple processes the transaction. Using the information printed on the bottom of the check, the company can identify the financial institution your check is drawn on and your account number. The company uses the Automated Clearing House (ACH) Network* to forward a check to your financial institution. This procedure should quickly clean up honest mistakes made by check writers. And once the check clears, the debit is satisfied and you can write checks again without the worry of being turned down or of getting embarrassing phone calls.

Here are some of the most frequently asked questions regarding the new electronic re-presentment process. If you have questions about a specific entry appearing on your account statement, it's best to contact your financial institution.

Q. What does it mean if the store has an "electronic re-presentment" policy?

A. If your check is returned unpaid for non-sufficient funds (NSF), the merchant can re-present the check electronically. This means that an electronic check transaction is posted to your account instead of the physical (paper) check.

Q. Who can electronically debit my account for an NSF check?

A. Merchants, billers and financial institutions have the option of debiting your account electronically for checks that have been returned NSF, as long as the proper notice has been provided to you in advance.

Q. What gives the store permission to electronically debit my account?

A. Merchants using electronic check collection are required to provide notice to you before you write your check. As long as this notice is provided, the merchant can process your NSF check electronically.

Q. Can the merchant or billing company add a collection fee and charge my account for the total of the check and the fee?

A. No. The re-presented check entry must be for the face amount of the check only. If using the ACH network, the company may only charge your account for a collection fee if you have provided express written authorization.

Q. Will my financial institution charge a fee for an electronic check re-presentment?

A. That's up to each financial institution. Check with your financial institution to be sure.

Q. What if I was not notified of the electronic re-presentment process?

A. You may sign an affidavit with your financial i nstitution that you did not receive notice. Your account will be credited for the unauthorized debit and an investigation will take place.

Q. What happens to my check, once the electronic check transaction has been paid?

A. The company or its agent keeps your physical check for 90 days, and a copy is kept for seven years.

Q. What happens if the merchant submits an electronic re-presentment after I've paid for the amount of the check at the store?

A. You may sign an affidavit with your financial institution t hat your account was charged twice in error. Your account will be credited for the duplicate transactions and an investigation will take place.

Q. How do I get my check back or a copy of the check?

A. Contact your financial institution. They can obtain a copy for you from the originating company. Alternatively, you can contact the company directly.

Q. How will an electronically re-presented check appear on my account statement?

A. Listed with electronic transactions, the re-presented check entry will contain the name of the payee, the description "REDEPCHECK", and the check amount. After September 17, 1999, your financial institution will also be required to provide the check number on your statement.

Q. What do I do if there's an error on my account statement?

A.. As always, contact your financial institution as soon as you discover an error on your statement