New cheques which are enabled for online clearing which includes cheque scanning as well as transmission online will only be in use from 1 January 2013. This system will boost the clearing system and this new system is called cheque truncation system (CTS).
However only 40% of the bank account holder have the new formatted cheque book and remaining 60% are even don’t know about the new rule as well as don’t apply for the new cheque book even in mid-December. However, banks are doing their best to connect with customers by sending sms, emails, give banners in website and newspaper, and put notices in banks and ATMs etc.
According to RBI, It advised all northern and southern regions to issue CTS cheque books from April 2012 and others to September 2012. Banks started issuing CTS cheque books from mid-September.
CTS-2010 is the new cheque system which has the main feature of speed clearing. In this new system no physical cheque will be moved to one bank to another for clearing. Cheques will be scanned and mailed to the respective banks for clearing. The issue bank will give acceptance or rejection by mail to the other bank. In this system cheque will be cleared in 2-3 hours which takes 3-15 days in current system.
In current system cheques deposited for clearing are physically moved to the RBI, and from there to the respective bank’s clearinghouse in a specific city and then to the specific branch.
In the new CTYS system, huge time and human source will be saved in the clearing system. Banks will also save a huge amount which is spending on travelling, courier and logistics expenses.
Some cities like Delhi, Mumbai, Chennai and Bengaluru are already started the CTS-2010 system speed clearing and Hyderabad will start very shortly.
It will also bring down the cheque-handling time for a bank as the scanned image will bring the specimen signature of the issuer along with it on the screen. More important, the consumer will benefit as it will cut down the cheque realization time to almost real-time levels.
New pattern cheque
Cheque design for branding for identification
Uniform paper quality
Fixed name place
Fixed MICR code place
Fixed signature place
Security features like watermark
Bank’s logo (invisible to the naked eye)
However new CTS-2010 is full of advantages and save a lot of time and money but it also has some disadvantages too which are as under.
-No cutting allowed
-Less knowledge of banks staff
-Doubts on thumb impression
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