KNOWLEDGE JUNCTION

Cheque Truncation System (CTS) is the project undertaken by Reserve Bank of India for faster clearing of cheques. it brings huge benefits to customers by substantially reducing the time taken to clear the cheques as well as to the banks by increasing operational efficiency by cutting down on overheads in physical cheque clearing by using cheque image, instead of the physical cheque. The cheque image is truncated at the presenting bank. Subsequently, the cheque image moves through various steps in the cheque-clearing cycle and transactions are settled on the basis of images and the data. 

Cheque Truncation System (CTS) consists of a data and image-capturing application with high speed, mid-range and small shoe box-sized image scanner. 

New Delhi Grid: New Delhi including NCR, Haryana, Punjab, Uttar Pradesh, Uttarakhand, Bihar, Jharkhand and the Union Territory of Chandigarh. 

Mumbai Grid: Maharashtra, Goa, Gujarat, Madhya Pradesh and Chattisgarh.

Chennai Grid: Andhra Pradesh, Telangana, Karnataka, Kerala, Tamilnadu, Odisha, West Bengal, Assam and the Union Territory of Puducherry.

CTS Outward clearing process

1. Collection of cheques from various sources like drop boxes, ATMs and those submitted at the branches.

2. Verification of the details of physical cheques against the listing done as per the deposit slip.

3. Segregation of cheques basis the banks participating in CTS clearing and other banks which are part of MICR clearing.

4. Scanning the deposit slips and cheques in the capture system of the respective banks.

5. Balancing the amount and number of instruments captured as per the deposit slips against the total number and amount of the scanned images of the cheques pertaining to that deposit slip.

6. In case of any difference then locate the difference and take corrective action then and there.

7. Process the outward clearing data in core banking software to ensure that the account number and the name matches with the deposit slip details.

8. Affix digital signature for the batches

9. Uploading the instruments in Clearing House Interface ( CHI )

10. Monitoring the outward file bundling

11. Handling the paper to follow instruments

12. Tallying the total instruments and amount as per CHI with the outward register of the bank to ensure all the instruments are presented and processed.

CTS Inward clearing process

1. Monitor inward exchange file

2. Take the inward cheques data and upload the same in the in branch viewer software

3. Do the technical scrutiny of the instruments online or after taking the print out of all the instruments.

4. Generate posting files to be posted in core banking software.

5. Verify the signature on the cheque against the one available in the master data.

6. In cases were the images are not clear then the paying bank can request the presenting bank to send the original instrument for processing.

7. Pick up all the physical cheques that are to be received under paper to follow process.

8. Finalizing the returns for the day and marking the same in the capture system for onward transmission to the CHI

9. Tallying the debit received in the settlement account with the inward clearing totals and credits with the returns.

10. In case of any discrepancy because of wrong amount processed by the presenting bank pass the instrument and settle the difference outside the system.

Features of a CTS Cheque