To prevent rising cheque-related fraud cases, the Reserve Bank of India has asked banks to alert the account holders by a phone call and contact the base branch in case of non-home cheques before clearing suspicious or high value payments.

The RBI also asked banks to send an SMS alert to payer or drawer when cheques are received for clearing and examine cheques under UV lamp for clearance beyond 2 lakh rupees. The apex bank, further, said multi-level checking should be done before clearing cheques above 5 lakh rupees.

The RBI in a communication also asked banks to take appropriate precautionary measures to ensure that the confidential information is neither compromised nor misused either from the bank or from the vendors' side.

It also advised banks to review and strengthen the controls in the cheque presenting or passing and account monitoring processes. The central bank maintained that due diligence should be observed at the time of handling or processing of the cheques.