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Thursday, 18 March 2021

RBI Order:The check truncation system will be implemented in all banks by September 30

RBI Order:The check truncation system will be implemented in all banks by September 30, which will clear the check within 24 hours.

The Reserve Bank of India (RBI) has asked all banks to implement Check Truncation System (CTS) in all their branches by September 30. A check transaction system is a process of clearing a check. After implementing this system, check clearance will be faster and work will be completed faster.

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The Czech Truncation System was introduced in 2010. The Czech Truncation System was introduced in

2010, but so far it has been implemented in only 150,000 branches. With this in mind, the RBI has now issued a circular to the chairmen and managing directors of all banks, saying, "It has been observed that many branches of banks have been excluded from any formal clearance system. Because of this their customers are facing trouble, as it takes more time and also the charge in check collection comes more. With this in mind, image based CTS should be implemented in all branches by September 30, 2021.

What is a Czech truncation system?

 There will be no need to go from one bank to another for the physical check declared in it, but it is cleared by taking a photo of the check. In fact in the old system the check which is presented in the bank, is sent to the drawy bank branch from there. This way it takes time to clear.

How does CTS work?

Under it, it is not necessary to move from one bank to another to clear a check, besides, an electric image of it can also be sent, which makes the work quick and easy. It can be accompanied by other necessary information like MICR (Magnetic Ink Character Recognition) band, etc. It saves time. Due to which this process is completed in 24 hours. Customers who do not have a CTS standard check will have to change their check. This is a multi city check.

Fraud remains a low probability

was applied to reduce the time for CTS Czech Clearing and prevent it from fraud. Verification by CTS is easier and faster, which reduces the likelihood of fraud. It took a long time to clear a check before CTS, which caused a lot of problems not only for the customers but also for the banks.

Its advantages

CTS checks are cleared within 24 hours

Such a check cannot be used as a counterfeit check

Clearing facility in any bank anywhere in the country

There is also a risk of paper clearing

This feature is comfortable for both banks and customers

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