UCO Bank

Policy on Collection of Domestic Cheques / Instruments (2018-19)

Sr.No Point No Particulars
1 1 Preamble
  1.1 Policy Objective
2 2 Arrangements for Collection
  2.1 Cheque Drop Box Facility
  2.2 Local Cheque
  2.3 Outstation Cheques
  2.4 Immediate credit of Local / Outstation Cheques / Instruments
  2.4.1 Charging of interest on cheques returned unpaid where instant Credit was given
  2.4.2 Satisfactorily conducted account
  2.5 Purchase of Local /Outstation Cheques
  2.5.1 Purchase of Local Cheques, Drafts etc. During suspension of Clearing
  2.6 Collection of A/C Payee Cheque-Prohibition on crediting proceeds to third party
3 3 Time Frame for collection of Local /Outstation Cheques/Instruments
  3.1 For Local Cheques/Instruments
  3.2 For Outstation Cheques/Instruments
4 4 Payment of Interest for Delayed Collection of Cheques
  4.1 Interest for delayed collection shall be paid at the following rates
  4.2 Delay in re-presentation of technically returned cheques and levy of charges for such return
5 5 Cheques/Instruments lost in transit / in clearing process or at paying bank’s branch
6 6 Procedure for return/dispatch of dishonoured cheques
  6.1 Information on dishonoured cheques
  6.2 Dealing with incidence of frequent dishonor
7 7 Payment of Cheques/Draft/Pay Orders/Banker;s Cheques beyond three months from the date of issue
8 8 Cheque Clearing under CTS Grids- Responsibility of Collecting Banker
9 9 General
10 10 Customer Grievance Redressal
11 11 Force Majeure
12 12 Miscellaneous
13 13 Other Policy related Issues (General)


Keeping in view the technological progress in payment and settlement systems and the qualitative changes in operational systems and processes that have been undertaken by a number of banks, the Reserve Bank of India had, with effect from 1st November 2004, withdrawn its earlier instructions to commercial banks on (i) Immediate Credit of local/outstation cheques, (ii) Time Frame for Collection of Local / Outstation Instruments and (iii) Interest Payment for Delayed Collection.

The withdrawal of these mandatory guidelines was expected to enable market forces of competition to come into play to improve efficiencies in collection of cheques and other instruments. The withdrawal of RBI instructions to Banks on time frame & payment of interest has offered bank further opportunity for increasing efficiency.

This Policy brings out the obligations of the bank to the customers and the rights of the customers on collection of local/outstation cheques / instruments and related issues.


This collection policy of the Bank is a reflection of our on-going efforts to provide better service to our customers and set higher standards for performance. The policy is based on principles of transparency and fairness in the treatment of customers. The branches are committed to increased use of technology to provide quick collection services to its customers. This policy document covers the following broader aspects:

  1. Collection of cheques and other instruments (including Speed Clearing) payable locally, at centres within India.
  2. Immediate credit of cheques (Instant credit facility).
  3. Our commitment regarding time norms for collection of instruments.
  4. Payment of interest in cases where the bank fails to meet time norms for realization of proceeds of outstation instruments.
  5. Dealing with collection of instruments lost in transit.
  6. Dealing with frequent dishonour of cheques.
  7. Remedial action during suspension of clearing.

2. Arrangements for Collection:

2.1. Cheque Drop Box Facility

Both the drop box facility and the facility for acknowledgement of the cheques at regular collection counters should be available to the customers and no branch should refuse to give an acknowledgement if the customer tenders the cheques at the counters.

Branches should ensure that customers are not compelled to drop the cheques in the drop-box. Further, in the context of customer awareness in this regard, banks should invariably display on the cheque drop-box itself that "Customers can also tender the cheques at the counter and obtain acknowledgment on the pay-in-slips". The above message is required to be displayed in English, Hindi and the regional language of the State concerned.

Branches are also advised to make absolutely fool proof arrangements while accounting for the number of instruments each time the box is opened so that there are no disputes and the customer’s interests are not compromised.

Cheque Drop Box should be designed and operated in a manner that nobody other than the authorized person is able to take out cheques from the drop box.

Cheque Drop Boxes to be always kept locked.

2.2 Local Cheques

a) All CTS Compliant cheques and other Negotiable Instruments payable locally would be presented through the clearing system prevailing at the centre. Cheques deposited at branch counters and in collection boxes within the branch premises before the specified cut-off time will be sent for clearing on the same day. Cheques deposited after the cut-off time and in collection boxes outside the branch premises including on-site ATMs will be sent in the next clearing cycle. As a policy, branches would give credit to the customer account on the same day clearing settlement takes place. Withdrawal of amounts so credited would be permitted on 2nd day or 3rd day as per the cheque return schedule of the clearing house. Wherever applicable, facility of high-value clearing (same day credit) will be extended to customers.

Cheques drawn on CBS branches will be credited in the customer’s account at UCO Bank on the same day. In case of cheques deposited in loans and advances accounts including term loan, value date credit will be given on day one or day two as the case maybe (i.e. the day on which settlement of the bank with RBI/SBI is done depending on clearing cycle at the place) for the purpose of calculation of products for application of interest, so that the customer gains interest benefits simultaneously on the amount debited to his/her deposit account. In case of immediate credit afforded as per para 2.4 below and withdrawal on or before day two or day three shall be treated as withdrawal against effects and applicable interest shall be charged for said intervening days between withdrawal and actual credit to the account.

Bank branches situated at centres where no clearing house exists, would present local cheques on drawee banks across the counter and it would be the bank’s endeavor to credit the proceeds at the earliest.

The cheques received up to cut-off time shall be sent on the same day to the local clearing house. The cut-off time shall be displayed by each branch across their counters and also on the drop box placed inside the branch premises. For High Value clearing and for credit to Govt. Accounts like Income Tax etc., a similar cut-off time notice to be displayed.

b) Non-CTS cheques will be presented in the clearing house at the prescribed intervals which is presently once in week on each Monday or as decided by RBI, from time to time. In certain categories of cheques, or instruments demanded by the correspondent Bank or Image Quality Assessment (IQA) failure will be presented in physical form to the drawee Bank.

2.3 Outstation Cheques

In case of Non-CBS environment/Non-Networked Centres, cheques (legend “CBS” missing on the cheque) drawn on other banks at outstation centres will normally be collected through bank’s branches at those centres. Where the bank does not have a branch of its own, the instrument would be directly sent for collection to the drawee bank or collected through a correspondent bank. The bank would also use the National Clearing services offered by the Reserve Bank of India at centres where such collection services exist.

RBI has introduced Speed Clearing Service at the identified centres for settlement of payments of outstation cheques drawn on Core Banking enabled branches through local clearing at the identified centre where the cheque(s) is lodged by a customer. Since our Bank has rolled over to 100% CBS, we shall provide the Speed Clearing Service at the identified centres where we have our presence. It will facilitate collection of cheques drawn on outstation core banking enabled branches of member Banks if they have a networked branch at the centre on which the outstation cheque is drawn.

Cheques drawn on bank’s own branches at outstation centres will be collected using the inter sol arrangement in vogue. As our branches are connected through a centralized processing arrangement and we are offering “Anywhere Banking Services” to our customers, same day credit to the customers will be effected in respect of outstation instruments drawn on any other bank whose outstation branch is also under CBS network and participating in the Local Clearing House.

2.4 Immediate Credit of Local/ Outstation Cheques/Instruments:

Branches / extension counters of the bank will provide immediate credit for outstation cheques/instruments up to the aggregate value of Rs.15000/- (upto Rs.25000/- in respect of Demand Drafts/Pay Orders/Interest/Dividend warrants drawn on our Bank/Branches and cheques issued by Govt. undertakings tendered for collection by individual account holders subject to satisfactory conduct of such accounts for a period not less than 6 months. Immediate credit will be provided against such collection instruments at the request of the customer or as per prior arrangement. The facility of immediate credit would also be made available in respect of local cheques at centres where no formal clearing house exists.

The facility of immediate credit will be available to individual account holders only and shall be offered in Savings Bank / Current / Cash Credit Accounts of the customers. For extending this facility there will not be any separate stipulation of minimum balance in the account. However, separate pay-in-slip (DS-2A) may be used for the purpose of immediate credit of outstation/local cheques.

2.4.1 Charging of Interest on cheques returned unpaid where Instant Credit was given:

If a cheque is sent for collection for which immediate credit was provided by the bank and it is returned unpaid, the value of the cheque will be immediately debited to the account. The customer will not be charged any interest from the date immediate credit was given to the date of return of the instrument unless the bank had remained out of funds on account of withdrawal of funds. Interest where applicable would be charged on the notional overdrawn balances in the account, had credit not been given initially.

If the proceeds of the cheque were credited to the Savings Bank Account and were not withdrawn, the amount so credited will not qualify for payment of Interest when the cheque is returned unpaid. If proceeds were credited to an overdraft/loan account, interest shall be recovered at the rate of 2% p.a. above the interest rate applicable to the overdraft/loan from the date of credit to the date of reversal of the entry if the cheque/instrument was returned unpaid to the extent the bank was out of funds.

2.4.2 Satisfactorily conducted account

  1. It should have been opened at least 6 months earlier and complying with KYC norms.
  2. Conduct of the account has been satisfactory and bank has not noticed any irregular dealings.
  3. Where no cheque / instrument for which immediate credit was afforded, returned unpaid for financial reasons.
  4. Where the bank has not experienced any difficulty in recovery of any amount advanced in the past including cheques returned after giving immediate credit. The total amount of all such cheques credited to the account but not realized should not exceed the maximum limit prescribed for immediate credit. In other words total exposure of the Bank in respect of unrealized cheques credited to the account should not exceed the maximum limit (Rs.15,000 to Rs.25,000 as the case may be).

In the event of dishonor of cheque against which immediate credit was provided, interest (refer Clause No. 9 below) shall be recoverable from the customer for the period the bank remained out of funds, (i.e., from the date of immediate credit till day before credit afforded to the bank) at the rate applicable for overdraft limits sanctioned for individual customers.

Bank shall levy normal collection charges and out of pocket expenses as service charges while providing immediate credit against outstation instruments tendered for collection. Exchange charges applicable for cheque purchase will not, however be charged.

2.5 Purchase of local/outstation cheques

A flat service charge of Rs.50/- per instrument shall be levied for extending immediate credit (up to a maximum amount of Rs. 15,000/Rs.25000/- as per the Policy) for local cheques received for purchase. For outstation cheques bank will be collecting the collection charges in vogue.

2.5.1. Purchase of Local Cheques, Drafts etc. during suspension of Clearing

There may be occasions when Clearing House operations may have to be temporarily suspended for reasons beyond the control of the authorities concerned. Such suspension entails hardship to the constituents because of their inability to realize promptly the proceeds of cheques, drafts, etc., drawn on the local banks other than those with whom they maintain accounts. Some remedial action has to be taken during such contingencies to minimise, as far as possible, the inconvenience and hardship to the constituents as also to maintain good customer service.

Thus, whenever clearing is suspended and it is apprehended that the suspension may be prolonged, branches may temporarily accommodate their constituents, both borrowers and depositors, to the extent possible by purchasing the local cheques, drafts, etc., deposited in their accounts for collection, special consideration being shown in respect of cheques drawn by Government departments/companies of good standing and repute, as also demand drafts drawn on local banks. While extending this facility, branches would no doubt take into consideration such factors as creditworthiness, integrity, past dealings and occupation of the constituents, so as to guard themselves against any possibility of such instruments being dishonoured subsequently. Limit on purchase of Local cheques at the time of suspension of clearing house operations should be as per the existing provision for instant credit i.e.Rs 15000/25000 as the case may be.

2.6. Collection of A/c Payee Cheque - Prohibition on crediting proceeds to third party A/c

  1. In consonance with the legal requirements and in particular, the intent of the Negotiable Instruments Act, 1881 and with a view to protect the banks being burdened with liabilities arising out of unauthorized collections, and in the interest of the integrity and soundness of the payment and banking systems, and in order to prevent recurrence of deviations observed in the recent past, the Reserve Bank has considered it necessary to prohibit the banks from crediting 'account payee' cheque to the account of any person other than the payee named therein. Accordingly, banks were directed that they should not collect account payee cheques for any person other than the payee constituent.
    Where the drawer / payee instructs the bank to credit the proceeds of collection to any account other than that of the payee, the instruction being contrary to the intended inherent character of the 'account payee' cheque, bank should ask the drawer / payee to have the cheque or the account payee mandate thereon withdrawn by the drawer. These instructions would also apply with respect to the cheque drawn by a bank payable to another bank.
  2. In order to facilitate collection of cheques from a payment system angle, account payee cheques deposited with the sub-member for credit to their customers' account can be collected by the member bank (referred to as the sponsor member) of the Clearing House. Under such arrangements, there should be clear undertaking to the effect that the proceeds of the account payee cheque will be credited to the payee's account only, upon realization.
  3. With a view to mitigate the difficulties faced by the members of co-operative credit societies in collection of account payee cheques, it is further clarified that collecting banks may consider collecting account payee cheques drawn for an amount not exceeding Rs.50,000/- to the account of their customers who are co-operative credit societies, if the payees of such cheques are the constituents of such co-operative credit societies. While collecting the cheques as aforesaid, banks should have a clear representation in writing given by the co-operative credit societies concerned that, upon realization, the proceeds of the cheques will be credited only to the account of the member of the co-operative credit society who is the payee named in the cheque. This shall, however, be subject to the fulfillment of the requirements of the provisions of Negotiable Instruments Act, 1881, including Section 131 thereof.
  4. The above instructions shall also extend to drafts, pay orders and bankers’ cheque.

3. Time Frame for Collection of Local / Outstation Cheques / Instruments:

3.1 For Local Cheques/Instruments:

Credit and Debit shall be given on the same day or at the most the next day of their presentation in clearing. (i.e., bank would give credit to the customer account on the day clearing settlement takes place. Withdrawal of amounts so credited would be permitted as per the cheque return schedule of the clearing house at the centre).

3.2 For Outstation Cheques/Instruments:

Cheques payable at CTS centres Maximum period of 07 days
Non CTS centres Maximum period of 10 days

The time frame for collection as shown above shall be treated as outer limit and credit shall be afforded if the process gets completed earlier.

4. Payment of Interest for delayed Collection of Cheques :

As part of the compensation policy of the bank, the bank will pay interest to its customer on the amount of collection instruments in case there is delay in giving credit beyond the time period mentioned above. Such interest shall be paid without any demand from customers in all type of accounts. There shall be no distinction between instruments drawn on the bank’s own branches or on other bank for the purpose of payment of interest on delayed collection. In case of a delay in credit of proceeds of an instrument sent for collection to some other bank, and if any part of delay is attributable to the paying bank, the customer will be compensated by us and sharing of compensation with paying bank will be settled by us with them ( IBA’s communication No. CE/RB/bcsbi-mcp/6272 dated 17th July 2012).

4.1 Interest for delayed collection shall be paid at the following rates:

For Local Cheques: Compensation at Savings Bank interest rate shall be payable for the period of delay.

For Outstation Cheques : Savings Bank rate for the period of delay beyond 07/10/14 days as the case may be in collection of outstation cheques, i.e., from 08th/11th/15th day, the interest will be payable.

Where the delay is beyond 14 days after the time frame for collection of outstation instruments (07/10/14- days as the case may be in collection of outstation cheques) interest will be paid at the rate applicable for term deposit for the respective period.
In case of extraordinary delay, i.e. delays exceeding 90 days after the time frame (07/10/14 - days as the case may be) for collection of outstation instruments interest will be paid at the rate of 2% above the corresponding Term Deposit rate.

In the event the proceeds of cheque under collection is to be credited to an overdraft/loan account of the customer, the bank would consider value-dating the proceeds keeping normal period required for collection in mind.

In case of local cheques (clearing), bank shall permit usage of the shadow credit afforded to the customers’ account immediately after closure of relative return clearing and in any case, withdrawal shall be allowed on the same day or maximum within an hour of the commencement of business on the next working day, subject to usual safeguards.

In case of delay in realization of local cheques, compensation at savings bank rate shall be paid for the corresponding period of delay (RBI’s communication No.RBI/201213/165DPSS.CO.CHD.No.284/03.06.03/2012-13 dated 13th August 2012.

It may be noted that interest payment as given above would be applicable only for instruments sent for collection within India and will be paid without demand by the customer concerned.

4.2 Delay in re-presentation of technically returned cheques and levy of charges for such return.

RBI has informed that instances have been brought to their notice that banks are (i) Levying Cheque return charges even in cases where customers are not at fault in such returns (ii) Delaying the re-presentation of the cheques which had been returned by the paying banks under technical reasons. Both of these issues result in unsatisfactory customer service.

Accordingly it has been decided by the Bank to adhere to the following instructions:

  1. Cheque return charges shall be levied only in cases where the customer is at fault and is responsible for such returns. The illustrative, but not exhaustive, list of returns, where the customers are not at fault are indicated in Annexure.
  2. Cheque that need to be re-presented without any recourse to the payee, shall be made in the immediate next presentation clearing not later than 24 hours (Excluding holidays) with due notification to the customers of such re-presentation through SMS alert, e-mail etc.

5. Cheques / Instruments lost in transit / in clearing process or at paying bank’s branch:

In the event of a cheque or an instrument accepted for collection is lost in transit or in the clearing process or at the paying bank’s branch, the bank shall immediately on coming to know of the loss, bring the same to the notice of the account holder so that the account holder can inform the drawer to record stop payment and also take care that cheques, if any, issued by him are not dishonoured due to non-credit of the amount of the lost cheques/instruments. The bank would provide all assistance to the customer to obtain a duplicate instrument from the drawer of the cheque.

In line with the compensation policy of the bank, the bank will compensate the accountholder in respect of instruments lost in transit in the following way:

  1. In case, intimation regarding loss of instrument is conveyed to the customer after the time limit stipulated for collection, interest will be paid for the period exceeding the stipulated collection period at the rates specified above.
  2. In addition, bank will pay interest on the amount of the cheque for a further period of 15 days at Savings Bank rate to provide for likely further delay in obtaining duplicate cheque/instrument and collection thereof.
  3. The bank would also compensate the customer for any reasonable charges he/she incurs for recording stop order and/or in getting duplicate cheque/instrument upon production of receipt, in the event the instrument is to be obtained from a bank / institution who would charge a fee for issue of duplicate instrument.
  4. The account holder must arrange to obtain a duplicate cheque/instrument within a maximum period of 14 days on receiving intimation from the Bank in respect of a cheque or an instrument lost in transit after it is discounted by the Bank. The amount of lost cheque, if already discounted by the bank and credited to the depositor’s account, will be reversed in case the duplicate cheque / instrument is not arranged by the customer within the stipulated period of 14 days.
  5. The onus of such loss lies with the collecting banker and not the account holder.
  6. If the cheque / instrument has been lost at the paying branch, the collecting banker should have a right to recover the amount reimbursed to the customer for the loss of the cheque / instrument from the paying banker.

6. Procedure for return / dispatch of dishonoured cheques :

  1. The paying bank should return dishonoured cheques presented through clearing houses strictly as per the return discipline prescribed for respective clearing house in terms of Uniform Regulations and Rules for Bankers’ Clearing Houses. The collecting bank on receipt of such dishonoured cheques should dispatch it immediately in any case within 24 hrs to the payees/holders.
  2. In relation to cheques presented direct to the paying bank for settlement of transaction by way of transfer between two accounts with that bank, it should return such dishonoured cheques to payees / holders immediately.
  3. Cheques dishonoured for want of funds in respect of all accounts should be returned along with a memo indicating therein the reason for dishonour as “insufficient funds.”
  4. In case of dishonor/return of cheques, the paying banks should clearly indicate the return reason code on the return memo / objection slip which should also bear the signature/initial of the bank officials as prescribed in Rule 6 of the Uniform Regulations and Rules for Bankers’ Clearing Houses (URRBCH).

6.1 Information on dishonoured cheques :

Data in respect of each dishonoured cheque for amount of Rs.1 crore and above should be made part of bank’s MIS on constituents and branches concerned shall report such data to their respective zonal office on a monthly basis and in turn zonal office will consolidate and submit the same to Head Office, Finance Department. Data in respect of cheques drawn in favour of stock exchanges and dishonoured should be consolidated separately by branch irrespective of the value of such cheques as a part of their MIS relating to broker entities, and be reported to their respective zonal office on a monthly basis. Zonal Office in turn will consolidate and submit this information to Head Office, Finance Department every month.

6.2 Dealing with incidence of frequent dishonor:

  1. With a view to enforce financial discipline among the customers, a condition for operation of accounts with cheque facility, should be made that in the event of dishonour of a cheque valuing Rupees one crore and above drawn on a particular account of the drawer on four occasions during the financial year for want of sufficient funds in the account, no fresh cheque book would be issued. Also, the Bank shall close the account at its discretion after giving due notice to the customer. However, in respect of advances accounts such as cash credit account, overdraft account, the need for continuance or otherwise of these credit facilities and the cheque facility relating to these accounts shall be reviewed by appropriate authority higher than the sanctioning authority.
    For cheques amounting to less than Rs.1 cr., bank shall give one more chance i.e. five occasions of the incidents of dishonour of cheque in a financial year due to insufficient fund under intimation to the drawer/account holder and shall follow the same procedure thereafter as mentioned hereinabove.
  2. For the purposes of introduction of the condition mentioned at (i)above in relation to operation of the existing accounts, branch may, affix a rubber stamp on the cover of the cheque book advising the constituents of the new condition at the time of issuing new cheque book.
  3. If a cheque is dishonoured for a third time on a particular account of the drawer during the financial year, branch shall issue a cautionary advice/letter to the constituent concerned drawing his/her attention to aforesaid condition and consequential stoppage of cheque facility in the event of cheque being dishonoured on fourth occasion for cheque of Rs. 1crore &above and fifth occasion for cheques of less than Rs.1 crore on the same account during the financial year. Similar cautionary advice/letter may be issued if the bank intends to close the account.

7. Payment of Cheques/Drafts/Pay Orders/Banker’s Cheques beyond three months from the date of issue :

With effect from April 1, 2012, bank has adopted a policy of not to make payment of cheques/drafts/pay orders/banker’s cheques bearing that date or any subsequent date, if they are presented beyond the period of three months from the date of such instrument. Branches should ensure strict compliance of these directions by printing or stamping on the cheque leaves, drafts, pay orders and banker’s cheques a suitable instruction to the holders of such instruments for presentment within the period of three months from the date of the instrument.

8. Cheque Clearing under CTS Grids – Responsibility of collecting Banker

Branches to note the amendment of sec.131 of N.I.Act 1881, Explanation-II which reads as, “It shall be the duty of the banker who receives payment based on an electronic image of a truncated cheque held with him, to verify the prima facie genuineness of the cheque to be truncated and any fraud, forgery or tampering apparent on the face of the instrument that can be verified with due diligence and ordinary care”.

9. General:

For the purpose of adducing evidence to prove the fact of dishonour of cheque on behalf of a complainant (i.e. payee / holder of a dishonoured cheque) in any proceeding relating to dishonoured cheque before a court, consumer forum or any other competent authority, bank shall extend full cooperation, and furnish him/her documentary proof of fact of dishonor of cheques.

10. Customer Grievance Redressal:

Customer grievances on time frame of collection, compensation by additional interest on delay in collection, cheques/ instruments lost in transit, etc. will be redressed as per the policy.

11. Force Majeure :

The bank shall not be liable to compensate customers for delayed credit if some unforeseen event (including but not limited to civil commotion, sabotage, lockout, strike or other labour disturbances, accident, fires, natural disasters or other “Acts of God”, war, damage to the bank’s facilities or of its correspondent bank(s), absence of the usual means of communication or transportation, etc.) beyond the control of the bank prevents it from performing its obligations within the specified service delivery parameters.

12. Service Charges:

For all collection services the branches will recover appropriate service charges as decided by the bank from time to time and communicated to customer, displayed on Bank’s website.

13. Incorporation of Name of the Purchaser on the face of the Demand Draft:

The name of the purchaser shall be incorporated on the face of the demand draft, pay order, banker’s cheques, etc., by the issuing bank.

14. Miscellaneous.

  1. With a view to encouraging faster migration to CTS-2010 standard cheques, branches are advised that non CTS-2010 standard instruments will be cleared at less frequent intervals in the CTS clearing centres. Branches to educate and notify their customers of the likely delay in realization of non CTS-2010 standard instruments in view of the arrangement for clearing of such instruments at less interval.
  2. Branches shall not decline to accept outstation cheques deposited by its customers for collection.
  3. Branches shall give wide publicity to the Cheque Collection Policy (CCP) by prominently displaying salient features thereof in bold and visible letters on the notice board at their branches.
  4. A copy of the complete CCP shall be made available by the Branch Manager, if the customer requires so.
  5. Cheques which are deposited with wrong account number mentioned on the Pay-in-slip, branches will return such cheques to the customers on the address mentioned within 48 working hours. However in cases with incomplete address, incomplete phone no., no phone number mentioned on the Pay-in-slip, the branch will be responsible to keep these instruments for a maximum period of 3 months.
  6. Cheques received back unpaid will be returned by post/ courier etc. to the customer within 48 working hours on the address recorded in Bank’s database. However, these will be kept in the branches for returning to the customer over the counter if he/she makes a request for the same. If not collected by the customer within 15 days branches to send them back at the recorded address by post or courier.
  7. Cheque related fraud cases- preventive measures:-
    Branches/Offices are to ensure that all procedural guidelines including preventive measures are followed meticulously by the dealing staff/officials while presenting the cheques in clearing, passing the cheques during the course of Banking, A/c monitoring etc.
    • Ensuring the use of 100 % CTS-2010 compliant cheques.
    • Strengthening the infrastructure of service branches for proper handling of cheques at their end bestowing special attention on the quality of equipment and personnel posted for CTS based clearing, so that it is not merely a mechanical process.
    • Ensuring that the beneficiary is KYC compliant so that the bank has recourse to him/her as long as he/she remains a customer of the bank.
    • Examination under UV lamp for all cheques beyond Rs. 1 lakh.
    • Checking of multiple levels, of cheques above Rs.3 lakh (Checking of such cheques should be done at more than one level).
    • Close monitoring of credits and debits in newly opened accounts based on risk categorization.
    • Sending an SMS alert to payer/drawer when cheques are received in clearing.
    • For collection of cheques of above Rs 25,000/- in newly opened accounts and Rs.1,00,000/- in the existing accounts KYC compliance to be ensured in writting from the Base Branch.
    • Dealing with suspicious or large value cheques - Contacting base branch in case of non-home cheques and alerting the customer by a phone call and getting the confirmation from the payer/drawer.
    • Due care and secure handling of cheques to be ensured during the movement of cheques and also cheques dropped in the collection boxes by customers.


  1. Policies laid down in this document shall be modified to give effect to any mandatory directives of the RBI or any policy change advised by the Government of India in this regard. The Board shall be kept apprised of such changes.
  2. Any deviation / exemption from the norms mentioned in this policy shall be permitted by the competent authority only and competent authority in the context of this policy shall be the MD & CEO/ Executive Director.
  3. If any question arises regarding the application and / or interpretation of the policy / directives, a reference shall be made to the MD & CEO /Executive Director for clarification and the referred matter will be dealt with in accordance with his decision.
  4. If any situation or problem arises which has not been covered by these policy / directives a reference shall be made to the MD & CEO / Executive Director and the situation / problem will be dealt with in accordance with his decision.
  5. If the application of this policy/directives to a particular situation apparently leads to the defeat of the purpose and spirit thereof, the matter shall be referred to the MD & CEO /Executive Director and the referred matter will be dealt with in accordance with their decision.



Illustrative but not exhaustive list of objections where customers are not at fault
(Applicable for instrument and image-based Cheque Clearing as detailed in Annexure-D to Uniform Regulations and Rules for Bankers’ Clearing House)

Code No. Reasons for Return
33 Instrument mutilated; requires bank’s guarantee
35 Clearing House stamp/date required
36 Wrongly delivered/not drawn on us
37 Present in proper zone
38 Instrument contains extraneous matter
39 Image not clear; present again with paper
40 Present with document
41 Item listed twice
42 Paper not received
60 Crossed to two banks
61 Crossing stamp not cancelled
62 Clearing stamp not cancelled
63 Instrument Specially crossed to another bank
67 Payee’s endorsement irregular/requires collecting bank’s confirmation
68 Endorsement by mark/thumb impression requires attestation by Magistrate with seal.
70 Advice not received
71 Amount/Name differs on advice
72 Drawee bank’s fund with sponsor bank insufficient (applicable to sub-members)
73 Payee’s separate discharge to bank required
74 Not payable till 1stproximo
75 Pay-order requires counter signature
76 Required information not legible/correct
80 Bank’s certificate ambiguous/incomplete/required
81 Draft lost by issuing office; confirmation required from issuing office
82 Bank/Branch blocked
83 Digital Certificate validation failure
84 Other reasons-connectivity failure
87 ‘Payee’s a/c Credited’ – Stamp required
92 Bank excluded


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