New rule for cheque payments from January 1: Here’s all you need to know

The Reserve Bank of India (RBI) determined to introduce the ‘positive pay system’ for cheque in August in an announcement made by governor Shaktikanta Das. Under this new cheque fee rule re-confirmation of key particulars can be wanted for funds past ₹50,000. The rule will come into impact from January 1, 2021 with the aim of making certain client security and decreasing the circumstances of fraud in cheque fee.

Here’s the whole lot you have to know in regards to the new rule for cheque funds:

1. Positive Pay system is an automatic fraud detection software that matches particular data associated to the cheque offered for clearing, such because the cheque quantity, cheque date, payee identify, account quantity, quantity, and different particulars towards an inventory of cheques beforehand approved and issued by the issuer.

2. National Payments Corporation of India (NPCI) shall develop the ability of Positive Pay within the Cheque Truncation System (CTS) and make it accessible to participant banks. Banks, in flip, shall allow it for all account holders issuing cheques for quantities of ₹50,000 and above.

3. Under this course of, the issuer of the cheque will submit sure minimal particulars of that cheque like date, identify of the beneficiary / payee, quantity, and so forth. to the drawee financial institution electronically, by means of channels like SMS, cellular app, web banking, ATM, and so forth.

4. The particulars can be uploaded by the financial institution’s system into the centralized knowledge system of Positive Pay. When the cheque is obtained by the financial institution, it would confirm the main points from the central database and make the fee if the main points which the account holder has supplied match these on the cheque. In case of a mismatch, the financial institution will reject the cheque.

5. Although availing this facility is on the discretion of the account holder, banks could think about making it necessary in case of cheques for quantities of ₹5,00,000 and above.

6. RBI has suggested banks to create ample consciousness amongst their clients on options of Positive Pay System by means of SMS alerts, show in branches, ATMs in addition to by means of their web-site and web banking.