Hyderabad: Despite the rise of digital payments, cheques are still crucial for high-value transactions. Although there are difficulties like correcting the amount mentioned in the cheque and forgery signatures, these are very important in the banking system. Positive Pay System (PPS) is now available to avoid these scams. This gives more added security to the cheques. Banks do not accept cheques unless the cheque amount and cheque drawee details are first informed to the bank.
Banks take Positive Pay System confirmation from customers before making payments for cheques of Rs 5 lakhs and above. These rules came into effect on August 1. National Payments Corporation of India has developed this process. The RBI has already issued guidelines regarding its implementation. The RBI said that this step has been taken to increase security in the payment of cheques and reduce fraud due to tampering with cheques. Customers have the discretion to use the facility for all cheques. However, it is mandatory for amounts above Rs 5 lakhs.
Also read: Explained: New cheque security system to be implemented from 1 January
Under Positive Pay System confirmation, customers should inform the bank of the cheque number, date, amount in numbers and letters, the name of the person, who took the cheque and the transaction code. The details can be entered through an SMS, mobile app, internet banking, ATM, or at the bank branch concerned or service centre (during working hours).
When the cheque comes for payment, the bank verifies all the details and clears it if there is any discrepancy. Once registered they cannot be changed. If not.. the account holder has the right to stop payment of the cheque. Clients issuing cheques should ensure that there are sufficient funds in the account when it comes to payment.
