Final answer:
The Check Clearing for the 21st Century Act (Check 21) promotes the use of electronic images of checks for faster processing, thereby improving the efficiency and safety of bank check clearing.
Step-by-step explanation:
The Check Clearing for the 21st Century Act (Check 21) is a federal law that was enacted to modernize the way banks process checks. The correct statement regarding Check 21 is: B) It promotes the use of electronic images of checks for faster processing. This act allows banks to handle more checks electronically, which speeds up the clearing process and reduces the need to physically move paper checks between banks. The intention was to improve the efficiency and safety of the check processing system, using technology to facilitate faster and more reliable transactions.
The incorrect options include: A) It requires the use of physical paper checks for all banking transactions, which is false because Check 21 actually encourages the opposite; C) It restricts the electronic transmission of check images among financial institutions, which is again false as the act facilitates this transmission; and D) It encourages the use of handwritten signatures on all checks, which has no relevance to the technological advancements promoted by Check 21.