New cheque rule from Dec. 1: RBI

Jul 01, 2010 |

mumbai

The RBI directive to banks, asking them not to honour cheques with overwriting, will come into effect from December 1 instead of the earlier scheduled date of July 1, the apex bank said in its latest circular.

The new rule is intended to prevent fraudulent withdrawal of money and expedite clearance of cheques.
Meanwhile, telecom company Bharti Airtel subscribers received an SMS on June 28 that said “as per RBI, cheques with changes in amount or payee name will not be cleared with effect from July 1.”
However, Airtel on Wednesday said it is in the process of sending a revised advisory to its customers informing them about the change in the deadline to December 1.
The Reserve Bank has also advised banks to create awareness among customers about the new norms, which were aimed at preventing fraud, besides expediting clearance of cheques where CTS (Cheque Truncation System) is used. Under CTS, image of cheque is sent to clearing house for transfer of funds.
The central bank in February this year had come out with a circular on “Standardisation and enhancement of security features in cheque forms” detailing the norms for image-based processing of cheques. — PTI

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