When I pay for my groceries by check, where does that check go?
In the year 2000, an estimated 70 billion checks will be written in the United States alone. This means that about 270 million checks are processed every business day. Keeping track of all that paper is a pretty complex procedure. Once you’ve paid by check for your groceries, the first place that check goes is to the grocery store’s bank, where it is deposited. But the funds may not be immediately available, unless you and your grocery store use the same bank (about 30 percent of checks are drawn on and deposited into the same bank), in which case the processing, or clearing, is handled internally. But otherwise, the grocery store’s bank will probably want to verify the check with your bank, the paying bank, before it converts the check value to cash. But most banks do not communicate with each other directly; instead, they go through a middle man, an intermediary bank. There
