Connect with Us
Moneylife - Facebook Moneylife - Twitter Moneylife - Linkedin Moneylife - Youtube Moneylife Rss feed

Moneylife » Newsviewer » Other News » RBI says new norms applicable to cheque truncation system only

RBI says new norms applicable to cheque truncation system only

Moneylife Digital Team | 23/06/2010 06:16 PM | 


The RBI has clarified that its directive on prohibiting alterations or corrections on cheques is applicable only to cheques cleared under the image-based cheque truncation system

The Reserve Bank of India (RBI) has clarified that its new norms related with alterations or corrections on cheques will be applicable only for cheques cleared under the image-based cheque truncation system (CTS). This will be applicable from 1 December 2010, the RBI said.

In a circular, the central bank said its prescription on prohibiting alterations or corrections on cheques is not applicable to cheques cleared under other clearing arrangements such as magnetic ink character recognition (MICR) clearing, non-MICR clearing, over-the-counter collection (for cash payment) or direct collection of cheques outside the clearing house arrangement.

According to a senior RBI official, it is true that 90% of cheque frauds involve beneficiary changes. A presenting bank has to be 100% sure that it is presenting a bonafide cheque and if it is not satisfied it may not present the same, he added.

The clarification from the central bank will give respite to a majority of bank customers who use the MICR clearing system and save them from the embarrassment of a cheque being returned.

Post Comment

More in Moneylife

CBI, ED questions genuineness of NDTV transactions through Mauritius +5858 views


Post your Comment

Alert me when new comment is posted on this article
 Please read our Moderation Policy and Terms of Use before posting


How Safe Is Your Building


You mean clients like THAT exist?
Would give an arm and a leg.
Bapoo Malcolm


Google new product search to be a paid service in US Moneylife Digital Team

CBI starts verifying complaint of coal block scam Moneylife Digital Team


1 Comment
Shantilal Hajeri

Shantilal Hajeri 5 years ago

It is better to have a uniform policy regarding the overwriting of cheques.
At the time of issueing the cheque the drawer may not know whether the cheque is going to be presented through micr clearing or cheque truncation. More over the provisions of Negoitatiable instrument act can not be discriminatory. The provisions regarding material alteration are covered under negotiable instrument act. The proposed policy of the RBI may need amendment to NI Act.

Reply »Link » Report abuse
Daily Newsletter

1,00,000 Readers

Follow Moneylife
DNL facebook icon DNL linked in icon DNL twitter icon DNL youtube icon DNL rss icon
Moneylife Magazine

Grab a Discount Coupon here

What's your say?

Will rising costs spoil the promise of Achhe Din?
Can't Say
Enter Code : secure code
    change code

What you said

Will the Gold Monetisation & Sovereign Bond Scheme help reduce demand of physical gold and fish out 20,000 tonnes of the yellow metal lying idle?

Thanks for casting your votes! View Previous Polls

Join Over 100,000 Awesome Readers

  1. News that Mainstream media does not always cover
  2. Views that are bold and unbiased
  3. Reports that focus on your interests as consumer, investor & citizen