During the 1990s, the Federal Reserve decided to transfer most of its check-clearing operations to the Federal Reserve Bank of Atlanta. Since then, the Fed’s fleet of Lear jets has been flying boxes of checks from cities of the various Fed district banks to one of the world’s busiest airports. There, the boxes of checks are loaded on trucks and driven to the Fed’s downtown check-sorting facility. After they are sorted, the checks are re-boxed and driven back through traffic to the Atlanta airport where they are flown to their final destinations for clearing.

Since 2004, the volume of checks being processed in Atlanta has declined as a result of the Check Clearing for the Twenty-First Century (“Check 21”) Act of 2003. This act allows the Fed and private check-clearing services to use the Internet to clear an increasing volume of checks. Employees of Fed district banks use special machines that conduct high-speed scans to create digital images of checks. They then transmit these images to other Federal Reserve district banks and depository institutions over the Web. The physical checks cleared in this manner require no further transportation beyond the warehouses where they are stored before being destroyed.

How is this speedier check clearing made possible by the Check 21 Act likely to affect the willingness of individuals and firms to continue writing checks rather than switching to debit cards and other alternative means of payment?