Migration to CTS 2010 Standards. Old cheques to be archived.

Standardization and Enhancement of Security Features in Cheque Forms-Migrating to CTS 2010 standards

The CTS grids are rapidly expanding their foot prints. In this context, it becomes more important for Banks to migrate to CTS 2010 Cheques. Though the migration has commenced, a lot of area has still to be covered.

RBI, DPSS vide its circular DPSS.CO.CHD.No./1112/04.07.05/2011-12 dated December 27, 2011 had advised all banks providing cheque facility to their customers to issue only ‘CTS-2010’ standard cheques in a time bound action plan not later than September 30, 2012.

With the September 30, 2012 deadline fast coming to a close, it was felt that the process be closely be monitored.  RBI has observed that that non-CTS-2010 Standard cheque forms continue to be issued by many banks even in regions which are forming  part of the northern (New Delhi) and southern (Chennai) CTS grids.

The main advantage of adoption of  CTS-2010 standards  are the  inherent security feature  advantages, aid the Presenting Banks to  identify the genuineness of the drawee banks’ instruments while handling them in the image based scenario.

It is to be remembered under CTS-2010 standards, the onus is on the Presenting Banks to be satisfied on the genuineness of the physical cheques sent in the CTS, as the physical instruments remain with the presenting bank only. Additionally, the fixed field placement specifications facilitate straight-through-processing at drawee banks’ end through the use of optical/image character recognition technology.

To minimize cheque-related frauds and to increase the Straight through Processing, RBI has advised Banks to adopt a time-bound migration to CTS-2010 standard cheque formats.

The process in brief is: –

01) To issue only multi-city/payable at par CTS-2010 standard cheques not later than September 30, 2012. A confirmation to reach the DPSS department by September 14, 2012.

02)Spread awareness for withdrawal of the non-CTS-2010 Standard cheques in circulation before December 31, 2012.  The awareness can be via SMS alerts, letters, display boards in branches/ATMs, log-on message in internet banking, notification on the web-site etc. A progress report to be sent to DPSS, by November 30, 2012.

03)The most important process – Banks holding post-dated EMI cheques (received either on their own behalf or on behalf of their NBFC clients) may arrange to ensure the replacement of non-CTS-2010 Standard cheques with CTS-2010 standard cheques before December 31, 2012.

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