Banking update: RBI to introduce positive pay system for cheques payment, enforced from 1 January 2021 onwards

New Delhi: The Reserve Bank of India (RBI) has taken an important decision to prevent bank fraud through paper money. The RBI has said that from January 1, 2021, it will introduce a positive pay system for cheques.

Under positive pay system, The important cheque derails will need to be reaffirmed in case the amount is overRs.50,000. In this system, the issuer of the cheque will have to give fewbminimum details about the cheque from electronic medium such as SMS, mobile app, internet banking or ATM.

The details invovles date, beneficiary’s name, recipient and amount will have to be given. These details will be matched before presenting the check for payment. If any discrepancy is found, the information will be given to the paying bank and the presenting bank. Steps will be taken to correct this.

According to RBI, availing this facility will depend on the account holder. However, banks can make this arrangement mandatory for cheques with an amount of Rs 5 lakh and above. The central bank said that this system will come into force from January 1, 2021.

Banks have been asked to make customers aware about this through SMS. Along with this, banks will give complete information about their branches, ATMs as well as on their website and Internet banking.

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