Figure 27.4 Federal- Reserve Collection

1
Figure 27.4Federal- Reserve Collection
Federal Reserve Bank
Step 3
Step 4
Depository Bank
Payor Bank
Step 2
Step 5
Step 1
Payee
Payor
Step 1 Payee provides goods and services to
payor payor gives check to payee. Step 2
Payee deposits check. Depositary bank credits
payees account. Step 3 Depositary bank
sends check to the Federal Reserve bank. The
Federal Reserve bank credits the
depositary bank for the check. Step 4 The
Federal Reserve bank sends the check to the payor
bank and debits it for the
check. Step 5 The payor bank debits the
payor for the check.