{"id":3684,"date":"2021-03-30T10:00:03","date_gmt":"2021-03-30T10:00:03","guid":{"rendered":"https:\/\/swaritadvisors.com\/blog\/?p=3684"},"modified":"2021-03-25T12:39:50","modified_gmt":"2021-03-25T12:39:50","slug":"rbi-extended-the-cheque-truncation-system-across-all-bank-branches","status":"publish","type":"post","link":"https:\/\/swaritadvisors.com\/blog\/rbi-extended-the-cheque-truncation-system-across-all-bank-branches\/","title":{"rendered":"RBI Extended the Cheque Truncation System across all Bank Branches"},"content":{"rendered":"\n<p class=\"has-drop-cap\">The Reserve Bank of India (RBI), on\n15.03.2021, has passed a Notification No RBI\/2020-21\/ 107 DPSS.CO.RPPD.No.SUO\n21102\/04.07.005\/2020-21, which states that the Apex Bank has extended the\nCheque Truncation System across all bank branches.<\/p>\n\n\n\n<p>The notification is issued in reference\nto Statement on Developmental &amp; Regulatory Policies, dated 05.02.2021, wherein\nthe RBI had announced PAN-India coverage of Cheque Truncation System by\nbringing all the branches of banks operating in the country under an image-based\nCTS clearing mechanism.<\/p>\n\n\n\n<p>This said directive is issued under the\nprovisions of section 10 (2) read with the provisions of section 18 of the\nPayment and Settlement Systems Act 2007.<\/p>\n\n\n\n<p>In this learning blog, we will deal with\nthe idea of the Cheque Truncation System, together with the need for extending\nthe cheque truncation system across all the branches of banks.<\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_65 counter-hierarchy ez-toc-counter ez-toc-light-blue ez-toc-container-direction\">\n<p class=\"ez-toc-title\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a3a62c0520cb\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a3a62c0520cb\"  aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/swaritadvisors.com\/blog\/rbi-extended-the-cheque-truncation-system-across-all-bank-branches\/#Concept_of_Cheque_Truncation_System\" title=\"Concept of Cheque Truncation System\">Concept of Cheque Truncation System<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/swaritadvisors.com\/blog\/rbi-extended-the-cheque-truncation-system-across-all-bank-branches\/#Need_for_Extending_Cheque_Truncation_System\" title=\"Need for Extending Cheque Truncation System\">Need for Extending Cheque Truncation System<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/swaritadvisors.com\/blog\/rbi-extended-the-cheque-truncation-system-across-all-bank-branches\/#Conclusion\" title=\"Conclusion\">Conclusion<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/swaritadvisors.com\/blog\/rbi-extended-the-cheque-truncation-system-across-all-bank-branches\/#Official_Notification_on_RBI_Extended_the_Truncation_System_of_Cheque\" title=\"Official Notification on RBI Extended the  Truncation System of  Cheque\">Official Notification on RBI Extended the  Truncation System of  Cheque<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Concept_of_Cheque_Truncation_System\"><\/span>Concept of Cheque Truncation System<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The term Truncation System of  Cheque  denotes a cheque clearing mechanism undertaken by the Apex Bank, i.e., RBI, for speedy cheque clearance. <\/p>\n\n\n\n<p>Further, the term truncation\nspecifically means a course of restricting the flow of a physical cheque in its\nway of clearance. That means instead of physical clearance, an electronic image\nof the cheque is transferred with significant essential data.<\/p>\n\n\n\n<p>Furthermore, the Cheque Truncation System or CTS brings elegance to the whole course of cheque processing and clearing and provides numerous benefits to banks, such as cost and time savings, cost effectiveness, inclusive of business process re-engineering,human resource rationalization, and enhanced customer service.<\/p>\n\n\n\n<p><strong>Also, Read: <\/strong><mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/swaritadvisors.com\/blog\/rbi-notifies-data-format-for-furnishing-of-credit-information\/\">RBI Notifies Data Format for Furnishing of Credit Information<\/a><\/mark><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Need_for_Extending_Cheque_Truncation_System\"><\/span>Need for Extending Cheque Truncation System<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The Cheque Truncation System is in use since the year 2010 and presently covers about 150000 branches all over the country. It shall be noted that all the 1219 non-CTS clearing houses have been migrated to the Truncation System of  Cheque  effective September 2020. <\/p>\n\n\n\n<p>However, it was seen that there are bank\nbranches that are outside the ambit of any formal clearing mechanism and their\ncustomers face hardships and issues due tothe high cost involved and longer\ntime taken in the collection of cheques presented by them.Further, to leverage\nthe availability of the Cheque Truncation System and to provide a uniform customer\nexperience regardless of the location of her\/his bank branch, it has been\ndeclared to extend Cheque TruncationSystem across all bank branches in India. <\/p>\n\n\n\n<p>To facilitate this, banks will now have\nto confirm that all their branches take part in image-based CTS under\nrespective grids by 30.09.2021. <\/p>\n\n\n\n<p>Also, it shall be noted that they are\nfree to embrace a model of their choice, such as deploying suitable\ninfrastructure in every bank branch, or following a hub and spoke model, etc.,\nand the respective banks will coordinate with the concerned Regional Offices of\n<a href=\"https:\/\/www.rbi.org.in\/\">RBI<\/a> to operationalize this.<\/p>\n\n\n\n<p>Moreover, banks are advised to inform RBI about the roadmap to achieve panIndia coverage of the Truncation System of  Cheque  and furnish a status report prior to 30.04.2021.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Conclusion\"><\/span>Conclusion<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>In a nutshell, RBI, on 15.03.2021, has passed a Notification, which declares extension of  Truncation System of  Cheque  across all bank branches. The same was in reference to the Statement on Developmental &amp; Regulatory Policies, dated 05.02.2021.<\/p>\n\n\n\n<p><strong>Also, Read: <\/strong><mark style=\"background: #fffd03 !important;\"><a href=\"https:\/\/swaritadvisors.com\/blog\/rbi-relaxes-norms-for-investment-by-fpi-in-defaulted-bonds\/\">RBI Relaxes Norms for Investment by FPI in Defaulted Bonds<\/a><\/mark><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Official_Notification_on_RBI_Extended_the_Truncation_System_of_Cheque\"><\/span>Official Notification on RBI Extended the  Truncation System of  Cheque<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n<a href=\"https:\/\/swaritadvisors.com\/blog\/wp-content\/uploads\/2021\/03\/Official-Notification-on-RBI-Extended-the-Cheque-Truncation-System.pdf\" class=\"pdfemb-viewer\" style=\"\" data-width=\"max\" data-height=\"max\"  data-toolbar=\"bottom\" data-toolbar-fixed=\"off\">Official-Notification-on-RBI-Extended-the-Cheque-Truncation-System<br\/><\/a>\n<p class=\"wp-block-pdfemb-pdf-embedder-viewer\"><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The Reserve Bank of India (RBI), on 15.03.2021, has passed a Notification No RBI\/2020-21\/ 107 DPSS.CO.RPPD.No.SUO 21102\/04.07.005\/2020-21, which states that the Apex Bank has extended the Cheque Truncation System across all bank branches. The notification is issued in reference to Statement on Developmental &amp; Regulatory Policies, dated 05.02.2021, wherein the RBI had announced PAN-India coverage [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":3685,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[50,56],"tags":[545],"acf":[],"_links":{"self":[{"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/posts\/3684"}],"collection":[{"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/comments?post=3684"}],"version-history":[{"count":3,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/posts\/3684\/revisions"}],"predecessor-version":[{"id":3689,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/posts\/3684\/revisions\/3689"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/media\/3685"}],"wp:attachment":[{"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/media?parent=3684"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/categories?post=3684"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/swaritadvisors.com\/blog\/wp-json\/wp\/v2\/tags?post=3684"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}