WASHINGTON (10/29/08)—The Government Accountability Office reports that while the Federal Reserve Board has been able to save on transportation and labor costs under The Check Clearing for the 21st Century Act of 2003 (Check 21) , check truncation has not yet resulted in overall gains in economic efficiency for the Fed or for banks. Check 21 was enacted to make check collection more efficient and less costly by facilitating wider use of electronic check processing. It authorized a new legal instrument—the substitute check—a paper copy of an image of the front and back of the original check. The GAO report, required by the Check 21 law, found that although check volume has declined, checks still represent a significant volume of payments that need to be processed, cleared, and settled. However, a survey of 108 banking customers found that most seem to have accepted changes to their checking accounts from check truncation. That, the GAO surmises, may result in future economies. The GAO said the interviews with bank consumers showed the majority accepted the lack of canceled checks and also accepted being able to access information about their checking account activity online. Several of those surveyed said they considered electronic image and online reviewing to be more secure than receiving canceled checks. Eleven percent of those consumers surveyed did express a preference for receiving canceled checks. Also, the GAO found that the federal banking regulators reported few consumer complaints relating to Check 21. While the GAO report was based on data collection instruments and interviews from the 10 largest banks by deposit size as of March 2008 and a group of smaller banks, which included credit unions, check truncation is not new to credit unions. For instance, even in 2002—just before Check 21 became law—CUNA figures found that 64% of credit unions offered share draft accounts and 91% of those credit unions utilized truncation. Approximately 7.1% of credit unions offering share draft accounts offered images of all checks with their statements. As of 2007, the most recent data available, CUNA figures showed 72% of credit unions offer share draft accounts. Their use of check truncation remains above 90%.