September 18, 2014 9:14 PM

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RBI to do away with need to return paid govt cheques to depts

Aiming to enhance efficiency of cheque clearing system, the Reserve Bank has decided to do away with the requirement of returning back paid government cheques to the concerned departments.In a notification issued from Mumbai on Thursday, RBI said that government cheques would be cleared through CTS that is Cheque Truncation System based on their electronic images. The notification added that if any drawee bank wants to verify government cheque in physical form before passing it for payment, the image would be returned unpaid under the reason 'present with documents'.RBI has further said that both the presenting and draweee banks need to preserve the cheques for a period of 10 years. It added that in some cases if the cheques are required for the purpose of any investigation or enquiry, they may be preserved beyond 10 years.The revised guidelines would be effective from October 1, 2014.

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