Model Policy on Collection of Cheques/Instruments
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been undertaken by a number of banks, the Reserve Bank of India had, with effect from 1st November 2004, withdrawn its earlier instructions to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.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 forperformance. The policy is based on principles of transparency and fairness in
the treatment of customers. The bank is committed to increased use oftechnology to provide quick collection services to its customers. This policy
document covers the following aspects:
• Collection of cheques and other instruments payable locally, at centres
within India and abroad.
• Our commitment regarding time norms for collection of instruments.
• Policy on payment of interest in cases where the bank fails to meet
time norms for realization of proceeds of outstation instruments.
• Our policy on dealing with collection instruments lost in transit.
2. Arrangements for Collection:
2.1. Local Cheques
All 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 presented for clearing on the same day. Cheques deposited after the cut-off time and in collection boxes outside the branch premises including off-site ATMs will be presented in the next clearing cycle. As a policy, bank would give credit to the customer account on the same day clearing settlement takes place. Withdrawal of amounts so credited would be permitted as per the cheque return schedule of the clearinghouse. Wherever applicable, facility of high-value clearing (same day credit) will be extended to customers.
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 endeavour to credit the proceeds at the earliest.