What defines a Remotely Created Check (RDC)?

The correct answer identifies a Remotely Created Check (RDC) as a check generated based on an authorization that does not require a signature from the account holder. This type of check is often used in situations where the payee has some form of authorization from the payer, but the payer does not physically sign the check. It allows for flexibility in payment processing and is commonly used in various transactions, especially in electronic payments where signatures may not be feasible.

In practice, the lack of a physical signature is a key characteristic of RDCs, distinguishing them from traditional checks that require the account holder’s signature for authorization. RDCs can facilitate quicker processing and are often used in scenarios where electronic transactions are preferred, but they still maintain a physical paper format.

Other options, while they may address aspects of checks or banking, do not accurately describe the unique nature of Remotely Created Checks. A clear understanding of the RDC concept highlights its function and relevant regulatory considerations in the payments landscape.