The new cheque payment rule will come into effect from January 1, 2021. Rbi Governor Shaktikanta Das also announced this at a meeting of the Monetary Policy Committee (MPC) on August 6 this year.
The cheque payment system is going to change majorly since January 1. The Reserve Bank of India has announced the introduction of a positive payment system from January 1, 2021. What is these new systems? What difference is it going to make to the general public? Let us know...
What is Positive Pay System
First of all, you know what this positive payment system is. Under this new rule, the required detail will need to be re-confirmed on payments of more than Rs 50,000. The new cheque payment rule will come into effect from January 1, 2021. Rbi Governor Shaktikanta Das also announced this at a meeting of the Monetary Policy Committee (MPC) on August 6 this year.
How this system will work
Positive Pay System is a kind of fraud capture tool. Under this system, anyone will have to give full detail to their bank when they issue cheques above Rs. 50,000. The cheque issuer will have to provide electronically check date, beneficiary name, account number, total amount and other necessary information to the bank through SMS, internet banking, ATM or mobile banking.
These information will then be cross-checked before the cheque payment. If all the details of the cheque are matched with the information given again, the bank will pay the cheque. But if the cheque is not checked, the bank will stop the payment.
Here, if there is a case of 2 banks i.e., the bank whose cheque has been deducted and the bank in which the cheque has been placed, both will be informed about it. This will cover about 80 per cent of the country's cheques in terms of value from the same system.
The National Payment Corporation of India (NPCI) will develop positive pay facility in the Cheque Truncation System (CTS) and make it available to banks. The system will be applicable to payments through cheques of 50,000 or larger unmounts. The Check Truncation System (CTS) is a process of clearing the cheque. Physical checks issued in it do not have to move from one place to another, but they are electronically tested. The Check Truncation system expedites the process of collection of checks.
Why this system is being implemented
RBI has decided to introduce a positive pay system keeping in view the safety of customers. The motive behind rbi's move to bring this rule is to prevent misuse of cheques. While the payment from cheque from this system is secure, clearance will also take less time. In recent years, banks have seen a lot of bungling by large-sum cheques. It is believed that the system will reduce fraud through fake cheques.
Make customers aware of banking
Rbi had directed all banks to reach out to customers at the earliest about the new cheque payment rules which will come into effect from January 1, 2021. As per this directive, all government and private banks are giving their customers information about the features of positive pay system through SMS alerts, branch displays, ATMs, websites and online banking.
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