Cheque Collection Policy

Introduction and Objectives

This policy is formulated to lay down the norms/procedures for collection/credit of cheques, loss of cheques/delay in collection of cheques, monitoring the dishonor of cheques, and return/re-presentation of cheques. The Bank is committed to increase the use of technology to provide transparent, fair and quick collection services to its customers.

Cheque deposit/acceptance norms

Cheque deposit procedure • The customer will be able to either deposit the cheque over the counter within the branch or drop the original physical cheque in the cheque drop box available within the branch
Cheque deposit timing • The cheque deposit facility (including the deposit of original physical cheque in the drop box) will be available to customer only during the working hours of the respective branch
Guidelines on acceptance of cheques • The Bank will only issue CTS compliant cheques and will honour cheques written by the customer in Hindi, English or in the concerned regional language

• The Bank will accept cheques for payment even if the date mentioned on the cheque is a date in Hindi or the date is as per the National Calendar (Saka Samvat), if the cheque is otherwise in order. The Bank will ascertain the Gregorian calendar date corresponding to the National Saka calendar in order to avoid payment of stale cheques

• The Bank will offer the facility for acknowledgement of cheques via digital medium

• The Bank will not decline to accept outstation cheques deposited by its customers

• The Bank will not collect any account payee cheques for any person other than the payee constituent mentioned in the cheque

Cheque Validity

Timeframe • The Bank will not make payment of a cheque bearing that date or any subsequent date, if it is presented beyond the period of three months from the date of the cheque

Time frame for collection of local/outstation cheques

Local Cheques • All cheques payable locally would be presented through the clearing system prevailing at the centres

• All centres covered under the same Cheque Truncation System (CTS) grid will be treated as a single clearing zone and cheques drawn on these centres and presented at any of the grid centres are treated as locally drawn cheques

• Outstation cheques drawn on banks participating in speed clearing will be collected and treated at par with local cheques if the Drawee bank has a branch presence at the local centre

• Cheques deposited within the branch premises before the specified cut-off time will be presented for clearing on the same day and the cheques deposited after the cut-off time will be presented for clearing in the next clearing cycle

• The cut off timings may vary from branch to branch and will be displayed at respective bank branches

• We would give credit to the customer account on the same day or maximum by the subsequent working day, from the time clearing settlement takes place

• Withdrawal of amounts so credited will be permitted as per the cheque return schedule of the clearing house
Outstation Cheques • Cheques which are drawn on other banks at outstation centres and which cannot be treated at par with local cheques will normally be collected through the Bank’s branches at those centres

• Where the Bank does not have a branch of its own, the cheque would be directly sent for collection to the drawee bank

• Collection of other Bank cheques between Main metros (Mumbai, Chennai, Kolkata, New Delhi) and state capitals (other than those of North Eastern states and Sikkim ): 7 working days

• Major cities: 10 working days

• In all other centres in India: 14 working days

• Working days shall not include Sundays, Bank Holidays and days when clearinghouse is not operational. Working days will be considered only if it is working day at both the ends/centers

• Charges may be applicable on the above as defined from time to time in the Schedule of Charges for each of the products

• For satisfactory accounts, we offer immediate credit for outstation cheques up to Rs.5000/- at the specific request of individual account holders or as per prior arrangements subject to the below mentioned criteria:

    • Value of cheque shall not exceed Rs.5000/-

    • The beneficiary account shall be at least one year old with no cheque returns in the account issued by customer in the last 6 months

    • Average Monthly Balance maintained for last 6 months

    • The account shall not be “inactive” or “dormant”

    • No cheque purchased under immediate credit earlier should be outstanding / pending for collection or returned unpaid

    • Normal cheque collection charges will be applicable

• In case a cheque where immediate credit was given is returned unpaid, the Bank will:

    • Immediately debit the cheque amount to the account along with interest at the prevailing savings bank for the period from the date of immediate credit to the date of debit to the account

    • Not charge the customer any interest from the date of immediate credit to the date of return of the cheque unless the bank had remained out of funds

    • Levy cheque return charges to the account as applicable for outstation cheques

Compensation for delay in credit to customers’ accounts
Compensation • Interest for delayed credit will be paid at the prevailing Savings Bank rate on the cheque amount for the period of delay from the date when the amount is due for credit

Cheques lost in transit/in clearing process
Bank obligations The Bank will immediately notify the accountholder so that:

• he/she can inform the drawer to record stop payment

• he/she can take care that other cheques, if any, issued by him/her are not dishonoured due to non-credit of the amount of the lost cheque(s)

Compensation • The Bank will compensate the accountholder for the interest at the prevailing Savings Bank rate on the cheque amount from the date when the amount was due for credit till the date of notice of loss of cheque to the customer

• The Bank shall reimburse the account holder related expenses for obtaining duplicate instruments and also interest for reasonable delays occurred in obtaining the same

• If the cheque has been lost at the paying bank's branch, the Bank shall have a right to recover the amount reimbursed to the customer for the loss of the cheque

Dishonour of Cheques
Norms • The Bank may reject cheques on account of technical reasons such as stale cheques, incorrect date, signature not matching with the account holder's sign and such other reasons or on account of insufficient funds

• For the purpose of adducing evidence to prove the fact of dishonour of cheque on behalf of a complainant (i.e. payee/holder of a dishonoured cheque) in any proceeding relating to dishonoured cheque before a court, consumer forum or any other competent authority, the Bank will extend full co-operation, and will furnish him/her documentary proof of the fact of dishonour of cheques

• The Bank will ensure not to reject or dishonour cheques/drafts issued by customers containing fractions of a rupee. To prevent misuse of the cheque drawing facility, the Bank will ensure that appropriate action is taken against the staff who have refused to accept such cheques/drafts and will avoid penalizing customers for unintended dishonour of cheques

Return/dispatch of dishonoured cheques

Norms and Procedure • The Bank will return dishonoured cheques presented through clearing houses strictly as per the return discipline prescribed for respective clearing house in terms of Uniform Regulations and Rules for Bankers' Clearing Houses

• In case of outward cheque return, an advice will be prepared by the Bank wherein the reason for return of the cheque will be indicated

• This advice along with the dishonoured cheque will be sent to the customer by registered post/local delivery/across counter

• The Bank will return/dispatch the dishonoured cheques to the customer at his/her last recorded address available with the branch

• In case of dishonour/return of cheques, the Bank will clearly indicate the return reason code on the return memo/objection slip which will also bear the signature /initial of the Bank officials as prescribed in Rule 6 of the Uniform Regulations and Rules for Bankers' Clearing Houses (URRBCH)

Delays/levy of charges in respect of re-presentation of technical return cheques
Customer is at fault • The Bank will levy cheque return charges only in cases where the customer is at fault and is responsible for such returns; Charges will be communicated to the customer in the Schedule of Charges

Customer is not at fault • In cases where the cheques need to be re-presented without any recourse to the payee, such re-presentation will be made in the immediate next presentation clearing not later than 24 hours (excluding holidays) with due notification to the customers of such representation through SMS alert, email etc.


• The policy will be reviewed by the Board as and when required or at least annually to incorporate regulatory updates/changes, if any

• The bank will not be liable to compensate customers for delayed credit if some unforeseen event (including but not limited to civil commotion, sabotage, lockout, strike or other labour disturbances, accident, fires, natural disasters or other “Acts of God”, war, damage to the bank’s facilities or of its correspondent bank(s), absence of the usual means of communication or all types of transportation, etc.) beyond the control of the bank prevents it from performing its obligations within the specified service delivery parameters

• The Bank will preserve the images of cheques received under CTS securely for a period of ten years as required under Procedural Guidelines for CTS. Further, the Bank will retain such documents as may be required as per the KYC/AML policy of the Bank

Regulatory References

• Master Circular on Customer Service in Banks dated July 1, 2015

• RBI Notification on Discontinuation of the requirement for Paper to Follow (P2F) for Central Government cheques under Cheque Truncation System dated December 31, 2015

• RBI notification on Procedure for Dishonour of cheques dated June 26, 2003

• IBA Model Cheque Collection Policy

• BCSBI Code of Commitment to Bank's Customers • RBI circular on Dishonour of Cheques – Modification in Procedure dated August 04, 2016

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© Copyright 2017, Paytm Payments Bank