Positive Pay System: All You Need to Know About New Cheque Payment Rules Applicable From January 1, 2021

New Delhi, December 15: The Reserve Bank of India had introduced Positive Pay System in August this year. Under it, certain new rules will have to be followed while making payments of over Rs 50,000 via cheque. The system comes into effect on January 1, 2021. The system aims to enhance keep consumer safety and lower the cases of fraud and abuse with respect to cheque payment.  Positive Pay System for Cheque Payments to Come into Effect from Jan 1: RBI.

Positive Pay is basically a tool designed to detect fraudulent activities. It matches specific information related to the cheque presented for clearing, like the cheque number, cheque date, payee name, account number, amount, and other details against a list of cheques previously authorised and issued by the issuer. Thereby making the transaction safer. RTGS Facility, Used for Large Value Transactions, to Become Operational 24X7 From December 14, Says RBI Governor Shaktikanta Das.

Here is all you need to know about the new cheque payment rules under Positive Pay System :

• It involves reconfirmation of key details including the cheque number, cheque date, payee name, account number, amount of large value cheques.
• The cheque issuer will be required to provide certain details of the cheque like name of the beneficiary/payee, amount, electronically via channels like SMS, mobile app, internet banking, ATM, to the drawee bank.
• The above mentioned details provided by the issuer will be cross-checked with the presented cheque by CTS. Discrepancies, if any, are flagged by the CTS to the drawee bank and presenting bank, who would then take redressal measures.
• National Payments Corporation of India (NPCI) will develop the facility of Positive Pay in CTS, which will be available to the participating banks as well. In turn, these banks will further enable it for all account holders issuing cheques worth Rs 50,000 or above.
• Availing the facility is nit mandatory and is at the discretion of the account holder. The banks are however consider making it compulsory in case of cheques for amounts of Rs 5,00,000 or above.
• The cheques are required to comply with the above mentioned rules in order to be accepted under dispute resolution mechanism at the CTS grids
• Member banks are also free to implement similar arrangements for cheques cleared/collected outside CTS as well.

These new rules will be applicable all over India for cheques worth Rs 50,000 or above from January 1, 2020. RBI aims to make the cheque transactions more safe with the Positive Pay System. It helps in reducing chances of fraudulent activities .

(The above story first appeared on LatestLY on Dec 15, 2020 03:15 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).