Mumbai: A few months back the Reserve Bank of India (RBI) made a decision to launch the ‘positive pay system’ for cheque. The new rule will be effective from January 1, 2021. As per the new rule, it may be necessary to reconfirm the details of the cheque, especially for payments above Rs 50,000. In the August MPC, the RBI governor Shaktikanta Das made an announcement in this connection keeping in focus consumer safety and also to reduce fraud cases as well as abuse vis-à-vis cheque payment.
Precisely speaking, the ‘Positive Pay’ is basically an automated fraud detection tool that corroborates particular information relevant to the cheque that is presented for clearing. Such details include payee name, cheque number, cheque date, account number, amount and other details.
Before the new rule comes into effect, it is important that you are aware of a few important things related to cheque payments from January 1, 2021.
- The idea of ‘Positive Pay’ entails reconfirming important details related to cheques worth Rs 50,000 and above.
- This process makes it mandatory for the issuer of the cheque to electronically submit specific details related to the cheque via Internet banking, SMS, mobile app, ATM and others. The issuer will be required to inform the drawee bank as well as the presenting bank details like name of the payee/beneficiary, amount etc. The CTS will flag any discrepancy to both the banks.
- The facility for the Positive Pay will be developed by the National Payments Corporation of India in CTS and it will be made available to the participant banks. On their part, the banks will make it available for their account holders who would be issuing cheques worth Rs 50,000 or above.
- However, availing the Positive Pay facility will solely be the account holder’s discretion. However, banks may also make it mandatory for large value cheques.
- Last but not the least important, the CTS grids will accept only cheques that are Positive Pay complaint in case of any dispute. In addition, the banks may also employ similar arrangements for all cheques (cleared/collected) that are even outside CTS.