From July 1, banks will not accept cheques with alterations or corrections even if the customer appends a signature above them.
The RBI has issued guidelines asking commercial, cooperative and urban banks not to entertain such cheques because of increasing complaints over alterations and corrections for fraudulent purposes.
In its circular DPSS.CO.CHQ.No.1832/01.07.05/2009-10, the RBI has asked banks not to accept cheques with alterations in the payee’s name as well as the amount in figures and words.
But corrections in dates will be allowed for some more time provided they are countersigned by customers. “This will solve 90 per cent of the problems faced by banks and will inculcate discipline in financial writing,” said Mr V. Sankar, deputy general manager of IDBI, Vijayawada.
The RBI has not only banned alternations but is also against changes in the format of the cheque leaf. “Some of the banks have more fields than approved by the RBI, when the cheque goes to the clearing house the additional fields come in the way of magnetic ink computer reading technology,” said Mr M.V. Murali, general secretary, State Bank of India Staff Union.
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IDBI infusion to be through preferential equity placement
Age Correspondent
New Delhi
Of the government’s capital infusion of Rs 6,211 crores in public sector banks, the infusion in IDBI Bank will be through the preferential placement of equity while in Central Bank of India it will be through participation in a rights issue. The three other banks would get capital by perpetual non-cumulative preference shares. Mr Pranab Mukherjee had said, “For the year 2010-11 it is proposed to provide a sum of Rs 16,500 crores to ensure that the banks are able to attain a minimum eight per cent Tier-I capital by March 31, 2011.”
The government had put Rs 1,500 crores into four banks in May 2010 and Rs 1,200 crores in three public sector banks in March 2010.