One lakh rupees is no longer considered ‘high value’ in banking parlance. Until recently, a cheque amounting to over a lakh was considered high value and would be swiftly cleared on the same day itself, if deposited before 11 am. Now that a lakh is no longer what it used to be, although it can still buy you a car, the Reserve Bank of India has raised the bar.
As of May 2, a cheque will have to be above Rs 5 lakh, and after August 1, above Rs 10 lakh for it to qualify as ‘high value’. From November 1, there will be no high value clearing. For same-day clearance, banks are advising their customers to fill in a special form and use RTGF (Real Time Gross Settlement) or NEFT (National Electronic Funds Transfer).
“The idea is to facilitate easier transactions by getting into electronic clearing,” says a RBI spokesperson. “Earlier, we made the transfer of amounts over Rs 1 crore mandatory through electronic clearing. We are gradually moving towards all transactions being cleared electronically.”
“As a retail investor, you should make sure your broker and your financial advisor both have your RTGF or NEFT number (the eleven digit number printed on your check) so that you can be sure that the transfer of money is quick,” says wealth manager Sujata Kabraji. “From experience, I have found a glitch in using RTGF because the transfer takes place directly and you have no proof that the money has been credited until you check your bank statement.”