Though the Reserve Bank of India deadline for issuing new cheques under the CTS 2010 (cheque truncation system) is coming to an end on March 31, many banks are yet to provide the new series of cheque books to customers. This is bound to create problems in cheque-based inter-city fund transfer in individual accounts of various banks after the deadline.
RBI had asked banks to replace non-CTS 2010 compliant cheque books, but most banks are understood to be going slow. Many customers are yet to receive either individual intimation on the new pattern or the fresh cheque books.
While most of the banks had given public notices on the change, asking the customers to collect new cheque books, it has evoked only partial response from customers. Several banks that promised to send CTS-compliant cheque books to the account holders by post have not been able to make much headway.
Amid the prevailing scenario, there is speculation that the deadline would be extended further. RBI had originally planned to implement the programme from January 1 this year, but it was postponed by three months in view of the lack of preparations by the participating banks.
The cheque truncation system is an electronic image based money transfer system which is envisaged to replace the current physical movement of cheques for enabling fund transfer.
Under the present system, cheques presented to a bank for payment to another account operated in a bank at a different place would have to be physically transported to the respective cheque clearing centres. The process involves logistical problems and hence delay.
The new system would enable the banks to transfer funds quickly in accordance with the electronic image of the cheque received by means of a common software for transmitting and receiving images with due cyber security measures.
The cheques used for the purpose have MICR (magnetic ink character recognition) features stipulated by RBI.