Lending major Punjab National Bank (PNB) said it will make high-value cheque verification system mandatory to protect the bank customers against frauds.
The bank will make ‘Positive Pay System’ (PPS) mandatory from April 4.
As per Reserve Bank of India (RBI) guidelines, PNB had introduced PPS for cheques of Rs 50,000 and above presented in ‘CTS’ clearing from January 1, 2021, which will now become mandatory from next month for the cheques of Rs 10 lakh and above.
The system, developed by the National Payments Corporation of India (NPCI), mandates a customer issuing the high-value cheque to reconfirm some essential details which are cross-checked while presenting the cheque in clearing before payment.
“PNB customers need to share details like account number, cheque number, cheque alpha code, issue date, amount, beneficiary name,” the lender said in a statement.
“These details are to be shared with the bank at least 24 working hours before the cheque is presented for clearing. Customers can share the details through its internet banking, mobile banking, SMS banking or in their home branch in the prescribed format.”
Last year, the RBI had issued guidelines to the banks to implement the PPS system to safeguard customers from the fraudulent collection of high-value cheques. It instructed banks to enable the facility for all account holders issuing cheques for amounts of Rs 50,000 and above.
It had said that while availing of the facility is at the account holder’s discretion, banks may consider making it mandatory for the cheque values of Rs 5 lakh and above.