As the central bank has postponed use of electronic cheque till
mid-July, the banks and financial institutions that are the members of the Nepal
Clearing House Ltd (NCHL) are mandated to use electronic cheque clearance (ECC)
service from the start of the next fiscal year.
Differing the earlier deadline, the central bank has directed the
banks to issue electronically readable standard cheques by the end of the
current fiscal year.
This is the second postponement as earlier in October, postponing
the earlier deadline, the central bank had asked the banks to start use of machine-readable
cheques by mid-January, 2014.
In April 2013, the central bank had for the first time directed
the banks and financial institutions to start using the fixed mid-July, 2013.
The banks and financial institutions have to issue new cheques
according to Cheques Standards and Specifications Guidelines 2011 – instead of
current ordinary cheques – to make the cheques compatible for electronic
clearing.
The standard cheques will have a character recognition technology
that will help facilitate the processing of cheques and will have the routing
number and account number at the bottom of a cheque.
Though,
Nepal Clearing House started electronically clearing Nepali currency cheques
from April 2012, with Automatic Check Truncation and clearing systems with the
current normal cheques, it still has not been able to make all the banks and
financial institutions its members. Currently, it has
"NCHL-ECC is an
image-based, cost-effective, magnetic ink character recognition (MICR) cheque
processing and settlement solution, where an original paper cheque is converted
into an image for electronic processing of the financial transactions between
participating member banks and financial institutions," according to NHCL.
"The physical movement of the cheques are truncated or stopped at the
presenting bank and the cheques' images are electronically moved between the
presenting and paying banks resulting in a faster and easier processing of the
cheque transactions.
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