Cheque Truncation System (CTS)

(For the benefit of those who have accounts in India)

 The Reserve Bank of India announced that it has extended the deadline for banks to ensure withdrawal on Non Cheque Truncation System (CTS) cheque till March 31, 2013.
What is CTS-2010?

CTS-2010 is a benchmark for standardization of cheques issued by banks across the country. The main feature of CTS-2010 cheques is that a cheque can be cleared electronically.

Simply put, a CTS-2010 cheque will not have to go through the process of physical clearance. When a customer deposits a CTS-2010-complied cheque, the bank can simply send the cheque’s image to the drawee bank, whose cheque has been issued; once the drawee bank scrutinizes and recognizes the cheque, it will get cleared. This move will help banks save on transaction cost and time.

What are the features?

CTS-2010 cheques will have security features such as a certain type of paper, CTS watermark, bank’s logo in invisible ink and a standard field placement for all banks.
Paper: CTS-2010 standard paper doesn’t glow under ultra-violet light. The paper will be image friendly and have protection against alterations by having chemical sensitivity to acids, alkalis, bleaches and solvents giving a visible result after a fraudulent attack.

Watermark: All CTS-2010 cheques will carry a standardized watermark with the words “CTS INDIA”, which can be seen when the cheque is held against a light source. You can see it in the same manner as you see Mahatma Gandhi’s image on a `500 note. Each cheque must hold at least one full watermark. The watermark will appear at the centre of the cheque.

Bank’s logo: The bank’s logo will be printed in ultra-violet (UV) ink. The logo will be visible under UV-enabled scanners or lamps. The banks logo has to be on the left top of the cheque.

Prohibition on corrections on cheques: Any kind of changes or corrections will not be acceptable. This means for any change in the payee’s name, amount in figures or amount in words, you will have to write a fresh cheque as it causes difficulty in electronic clearance. This also helps banks to identify and control fraud.

Additional text: The new cheque will also have “please sign above this line” mentioned at the bottom right of the cheque, a feature that was not available in cheques in use until now. Also, a statement “payable at par at all branches of the bank in India” will be written on the bottom of the new cheque.

Standardization of field placement: This basically means having the account number, watermark and bank logo, among other security features, positioned at the same place in cheques of different banks to make clearance through image easier. For example, cheques of all banks would have the watermark at the centre of the cheque.
All these features would ensure uniformity across cheques issued by various banks as well as help banks scrutinize cheques properly, which in turn is expected to act as a deterrent against cheque frauds.

What should you do?

Post-dated cheques: All post-dated non-CTS cheques will be out of use from 1 January 2013. An RBI spokesperson has clarified that all customers should, in their own interest, collect the signed non-CTS cheque given by him to his lender, say, a non-banking financial company, brokers and individuals, and cancel it so that such non-CTS cheque is not presented in the clearing system. The customer should intimate the bank along with the number of the non-CTS cheque and the individuals or company’s name, that the non-CTS cheque has been collected and cancelled.

If you don’t remember where you have given the cheque, you can go back to the front page of your cheque book and give the cheque numbers to the bank, informing that you don’t remember whom you have given it to. However, you need not worry as non-CTS cheque will automatically get cancelled from the system from 1 January 2013.

Cheques you haven’t encashed: If you have any cheques lying with you, which you can encash, you should do it as soon as possible. If you have any post-dated cheque for a date/month after 1 January 2013, ask the person/institution concerned to issue a CTS-2010 cheque, as the old one will not be valid after 31 December.

Comments

Post a Comment

Popular posts from this blog

FASTING - Is it good for health?

Intentionally skipping or delaying meals, known as fasting, is an unusual practice for many people, but it’s gaining popularity as a way to prevent disease and maintain a healthy body weight. Proponents of intermittent fasting believe it’s better for your health to constrain your eating to just a portion of the day, allowing your body to go stretches of 12 hours or more without food. Intermittent fasting is not a diet, but a method of scheduling your meals to optimize how your body uses nutrients. This pattern of eating doesn’t change the total number of calories you consume each day, but alters the frequency with which you eat these calories.   Maxine Barish-Wreden, M.D. opens new window , a complementary and integrative medicine physician with the   Sutter Medical Foundation Opens new window , says doctors and researchers are realizing that our current eating patterns are contributing to the health epidemics of obesity, metabolic syndrome and diabetes. She says intermitte...
Read more

World Renown Heart Surgeon Speaks Out On What Really Causes Heart Disease

We physicians with all our training, knowledge and authority often acquire a rather large ego that tends to make it difficult to admit we are wrong. So, here it is. I freely admit to being wrong.. As a heart surgeon with 25 years experience, having performed over 5,000 open-heart surgeries,today is my day to right the wrong with medical and scientific fact. I trained for many years with other prominent physicians labelled “opinion makers.”  Bombarded with scientific literature, continually attending education seminars, we opinion makers insisted heart disease resulted from the simple fact of elevated blood cholesterol. The only accepted therapy was prescribing medications to lower cholesterol and a diet that severely restricted fat intake. The latter of course we insisted would lower cholesterol and heart disease. Deviations from these recommendations were considered heresy and could quite possibly result in malpractice. It Is Not Working! These recommendations are no lon...
Read more

Detection Tools for Alzheimer

Image
I posted earlier on the  Behaviors of Alzheimer patients . Here is an article on the detection tools. Early Detection Alzheimer’s Tests: What’s New By Sarah Stevenson on January 26, 2013 Read about the growing arsenal of Alzheimer’s tests, from simple memory testing for mild cognitive impairment to brand-new brain imaging applications. Photo credit: Akira Ohgaki When it comes to diagnosing Alzheimer’s disease, the prevailing mantra is “the earlier the better.” The problem, of course, is that there are many potential causes for dementia, and by the time doctors are able to detect mental decline, Alzheimer’s has already begun to irreversibly damage the brain. Not only that, until recently it was only possible to confirm an Alzheimer’s diagnosis through posthumous brain examination. Cutting-edge research in the field of Alzheimer’s testing promises to change the way we diagnose the disease, and that’s encouraging news. With a new battery of tests in the arsenal, doctors...
Read more