Tuesday, November 30, 2010

RBI Circular: Alterations/Corrections on cheques effective 1st December, 2010

RBI vide their circular dated 22nd June, 2010 had prescribed certain guidelines with respect to alterations/corrections on cheques with a view to minimize incidents of cheque frauds on account of alterations to various fields on the cheques and thus provide protection to the customers as well as  the banks.

These guidelines will now be effective from 1st December, 2010.

As per the said guidelines, 'no changes/corrections should be carried out on cheques(other than for date validation purposes, if required). For any other change whether in respect of the payee's name, courtesy amount(amount in figures) or legal amount(amount in words) etc., fresh cheque forms should be used.

In line with RBI directives under the said guidelines, as and from the Effective Date any cheque bearing such alterations or corrections will not be accepted by the Banks at the time of deposit/presentation and are likely to be dishonoured.

 

Necessary precautions may therefore be taken to avoid dishonour of such cheques.

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