The Reserve Bank of India directives has implemented Positive Pay System (PPS) for all modes of cheque payments like (Cash/Transfer/Clearing) effective from 01 January 2021. Positive Pay System prevents fraud of cheque tampering/alteration.
Most Commercial banks provides Positive pay System to companies to protect them against forged, altered, and counterfeit checks.
Positive Pay System involves re-confirming of key details of the cheque at the time of payment processing. So we can protect ourself against fraud.
National payment corporation of India developed this system. Because of this we are able to secure our onlline banking system. So it is helpful for every individual.
It is a process of confirming the key details of large value cheques.
Under this system, a person issuing a high valued-cheque, submits certain essential details like the date, name, etc.
Limit on the amount for the system?
RBI has told banks to enable the facility for all account holders. Which is doing checks for the amount of rupees 50000. It has also said that while wealing of the facility is at the discretion of the account holder. Banks may consider making it mandatory in case of check values of 5 lakhs and above.
How is it beneficial for customers?
On issuance of a high-value cheque, customers should ensure that details are provided within a time frame prescribed by the banks for Hustle-free clearance. Acceptance of only registered cheques under Positive pay system covers Dispute Resolution Mechanism.
For cheque submission or rejection customer gets an SMS. Because of which security increases.
Cheque details
The details which are required for this procedure are account number, check number, date of the check, amount, transaction code beneficial name, MICR code. These details can be submitted to the respective bank’s website, internet banking or mobile banking. In Case of customer does not use electronic banking services he may visit bank branches in any respective City. Because of which there will be transparency.
Key features of PPS
- There is no option for modification or deletion of registered confirmation in anymore. After data submission to the server no deletion is possible so we should take care before submission. Which is provided by the national payment corporation of India. However customers can ask to stop the payment of issue checks at any point of time before its payment in CTS clearing or at the counter.
- Confirmation submitted/verified up to 6.00 PM through any channel/mode will only be processed for the next clearing session.
- Confirmation through branches can be provided during the normal business hours at the respective branch. Rest all the modes/channels will be available 24 x 7 to provide the positive pay confirmation
- All the authorized signatories as per the operating instructions in the account have to sign the confirmation form for providing confirmation through any branch in India.
- Customers have to enter the login credentials MPIN, password, etc in mobile banking/banking etc. But never share confidential details with anyone.
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