RBI to ensure cheques cleared in 24 hours

India's central bank, the Reserve Bank of India, has informed the National Consumer Disputes Redressal Commission that steps are being taken to ensure that cheques deposited in banks are cleared within 24 hours of their presentation so as to bring down the loss caused to consumers.

In its response to the Commission's directive on a complaint, the RBI said that "before the end of March, 2007, necessary action would be taken so that delay in clearing cheques would be minimum and in any case not more than 24 hours."

The RBI also explained that by and large the banks properly implemented the guidelines issued by it in this regard. A bench of the Commission, comprising its chairman Justice M. B. Shah and member Rajyalakshmi Rao, received the response on record and directed the RBI to publish the steps taken and contemplated to make consumers aware of their rights.

The Commission also asked the RBI to place the information in this regard on the Internet so that consumers could draw the attention of the respective banks in case of delay in giving clearance to the cheques.

The Bench was hearing a complaint alleging delay in giving credit to cheques presented for clearance by 88 commercial banks, including foreign banks operating in the country.

The Commission noted that only a few banks had informed that in the case of local clearance, credit was given soon after a cheque was presented but the funds were not allowed to be withdrawn till the amount was received by the bank concerned and, therefore, there was no loss to the customer. The Commission said this practice should be implemented uniformly by all the banks and asked the RBI to monitor the situation.

In the complaint, lawyers Atul Nanda and Rameeza Hakeen alleged that the banks in the country were earning nearly Rs. 621 crore in interest every day due to delay in crediting cheques sent for clearance.