Cheques with overwriting or cutting will not be honoured by the banks in the capital from 1st December, a move intended to prevent fraudulent withdrawal of money and expedite clearance of cheques.
The RBI in its directive to banks in June had asked banks not to accept cheques with overwriting or cutting from December 1.
However, changes or corrections would be allowed on dates. For any changes in the cheque, a fresh cheque form needs to be issued.
The new norms will be applicable only for cheques cleared under the image-based cheque truncation system (CTS), which is currently operational in
RBI had also advised banks to create awareness among customers about the new norms, which were aimed at preventing fraud, besides expediting clearance of cheques where CTS (Cheque Truncation System) is used. Under CTS, an image of cheque is sent to clearing house for transfer of funds.
The central bank in February had come out with circular on 'Standardisation and enhancement of security features in cheque forms' detailing the norms for image-based processing of cheques.
RBI had said that fresh cheques should be issued by customers in case of change in payee's name or amount (whether in figures or words). Changes, however, could be made with regard to date.
The new norms will not apply to those cheques, which are cleared by clearing houses that use Magnetic Ink Character Recognition (MICR) or non-MICR system.
Also, the norms will not be mandatory for over the counter collection of funds or for direct collection of cheques outside the Clearance House Arrangement.
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