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If you have written ‘hundered’ instead of ‘hundred’ on a cheque, don’t just strike off the additional ‘e’ and issue the cheque. Use a fresh leaf instead, or it could cost you Rs100-550. The Reserve Bank of India (RBI) has notified banks in a recent circular to not accept cheques that have corrections or alterations in anything but the date. The measure has been taken to “help banks identify and control fraudulent alterations”. The banks have started informing customers about the policy change through mailers.

If you issue a cheque with corrections, you will be slapped with cheque return charges that are Rs100-250 for public sector banks and Rs350-550 for private banks.

“It is consumer protection that the RBI is looking at. Many a times cheques are stolen and encashed by other parties by making corrections,” said S Govindan, general manager (personal banking and operations), Union Bank of India.

He said the move is essential keeping in view the changes in the way cheques are dealt with now. “Earlier, banks used to tell people not to issue a bearer cheque and about some basic precautions. But now cheques get couriered. Also, they are deposited in drop boxes. So the possibility of them falling into the wrong hands is high.”

The RBI also wants to reduce and, if possible, eliminate transactions through cheques. “Now that daily interest rate calculation has come in, it works in your favour to keep money in your account for as long as possible. At least three days are wasted in the issuance of a cheque. Whereas netbanking is instant,” said a banker.

Related Post:-

Cheques with alteration/corrections will not be honoured from 1st July 2010

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0 Comments

  1. Manhar Gupta says:

    Can a bank pay cash for a cheque for which I have deleted the words bearer? Even if the bearer has a genuine identification? Then what is the relevance of deleting the words – bearer?

  2. Nishant says:

    Promoting Net banking services is a good idea. But using NEFT and RTGS services involves bank charges ranging from Rs 5-25 for every transaction. If RBI is pushing with Cheque guidelines then it should also mandate bank to take off the charges or to take nominal annual charges for all transactions.

  3. srinin says:

    This is another example RBi pushing with changes without being fully equipped to assure customers that net banking is secure. Plus in a land where teh quality of literacy is not great how many can really access and use net efficiently.

    Instead of making things easier RBI is making it tougher for the public.

    The present system of playing on the float of customer’s money RBI’s making and now they want to promote net banking by showing that as a loss to the public!

  4. Alex says:

    The RBI also wants to reduce and, if possible, eliminate transactions through cheques. “Now that daily interest rate calculation has come in, it works in your favour to keep money in your account for as long as possible. At least three days are wasted in the issuance of a cheque. Whereas netbanking is instant,” said a banker.

    India doesnt have a proper net banking security system, yet RBI wants to phase out cheques in favour of net banking? God help the future banking system then!

  5. CS.SANJIB SAHU. says:

    A good proposition now set out by RBI to keep the Banks out of the reach from a distressed transactions arisen out of materially altered cheques.
    In addition to this ,RBI should mandate the Bankers to ask their customers for giving a periodical inventory of cheques utilised vis-a-vis not utilised.

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