CHEQUE- COLLECTION – POLICY (CCP)

Collection can be defined as the process of clearing instruments on behalf of the customers. The instruments cover:

• Cheques /Demand Drafts / Pay orders drawn in the same city / clearing zone of collection at the drawer bank branch.
• Cheques /Demand Drafts / Pay orders drawn in a city /clearing zone other than the drawer bank branch.

1.  ARRANGEMENTS FOR COLLECTION

1.1 Local cheques

All cheques and other Negotiable Instruments payable locally would be presented through the clearing system prevailing at the centre. Cheques deposited at branch counters and in collection boxes within the branch premises before the specified cut-off time will be presented for clearing on the same day. The cut off time varies from branch to branch. The applicable cuts off timings are displayed on the cheque drop box in branches for the benefit of the customers.

Cheques deposited after the cut-off time and in collection boxes outside the branch premises will be presented in the next clearing cycle. Bank will give credit to the customer account on the same day the clearing settlement takes place. Withdrawal of amounts so credited would be permitted as per the cheque return schedule of the clearing house. At present this credit is given on second day afternoon and withdrawal of amount so credited is also available on the same day.

1.2   Outstation cheques payable in India

      Proceeds of outstation cheques will be credited to customer account as per the norms below.

•  The bank does not have its own branches outside Delhi /New Delhi, therefore instruments would be directly sent for collection to the drawee bank or collected through a correspondent bank. At present Bank has tie-up with HDFC bank as correspondent bank for this collection. In addition bank would also use the National Clearing Services offered by the RBI at centre where such collection services exist.

• Cheques drawn on metro and other major cities which are covered under National clearing service are collected through this service and  funds will be credited to the customers account within seven working days.

• Cheques drawn on non-metro cities where HDFC bank has a branch, credit will be given on receipt of funds. Funds will be credited to the client account as soon as possible. In such locations where HDFC bank has branch, credit will be given in the customers account within eight to ten working days. This period   is not applicable to north eastern states, Sikkim and other tribal areas of the country.

• In case of cheques drawn on such locations where correspondent i.e. HFDC Bank does not have branch then cheques will be sent directly to drawee branch through registered post or through courier and proceeds will be credited to the customers account as soon as it is received from the drawee branch. Normal period for such clearance is twenty one working days. However efforts will be made to get the credit within 14 days as prescribed by RBI.

• Bank will charge normal collection and out of pocket charges from customers for outstation cheque collection.

1.3     Cheques  payable in Foreign Countries

• Cheques payable at foreign centre where the bank has correspondent banking arrangement will be collected through correspondent bank. At present bank has arrangement with Allahabad Bank for such collections. Proceeds of such receipts will be credited to the account as soon it is received from the correspondent bank and normal time taken for such transaction is between thirty to forty working days.

2.     CHEQUE/INSTRUMENT LOST IN TRANSIT IN CLEARING      
PROCESS OR AT THE PAYEE BANKS BRANCH

• In the event, a cheque or an instrument accepted for collection is lost in transit or in the clearing process or at the paying banks branch.

• The bank shall immediately on coming to know of   the loss, bring the same to the notice of the account holder. The bank will  ask the account holder to  inform the drawer to record stop payment and also take care that cheque  issued by him/ her are not dishonored due  to non credit of the amount of the instrument. The bank would provide all possible assistance to the customer to obtain a duplicate instrument from the drawer of the cheque like giving a certificate that it was lost etc.

• The bank would also compensate the customer with reasonable charges he or she incurs in getting duplicate cheque / instrument upon production of receipt, in the event the instrument is to be obtained from a bank /institution that would charge a fee for issue of duplicate cheque / instrument if the lost of cheque is due to the fault of the Bank.

3. COMPENSATION POLICY: INTEREST PAYMENT FOR      DELAYED COLLECTION - OUTSTATION CLEARINGS

    As part of compensation policy, interest will be paid to the customers on the amount of the collection instrument, in case there is delay in giving credit beyond the time period mentioned above.             

Interest for delayed collection shall be paid at the following rates:

i)          Simple interest @ 4% p.a. will be given for the period of delay beyond 7/10/14 days, as the case may be, in collection of outstation cheques.

ii)         In case of abnormal delay i.e. delay beyond 45 days simple interest will be paid @5% p.a. for the respective period.

iii)        In the case of extraordinary delay i.e delay exceeding 90 days, interest will be paid at the rate of 1% above the corresponding term deposit rate.

iv)        Interest as above will not be payable if the cheques / instruments are delayed by drawee branch. On account of any unjustified delays on part of the drawee bank in sending the proceeds to the collecting bank then bank would not be liable to pay any compensation to the customer.

v)        Bank would share / notify the reasons and other related facts of delay by drawee bank with the customer.

4. COMPENSATION POLICY: INTEREST PAYMENT FOR      DELAYED COLLECTION- LOCAL CLEARINGS

Interest for delayed collection will be paid at the following rates:

i)          4% p.a. simple interest will be given for the period of delay beyond 3 days in collection of local cheques.

5.    PROCEDURE TO BE FOLLOWED IN CASE OF DISHONOURED CHEQUES
A return advice will be prepared wherein the reason for return of cheque will be indicated. The advice along with the cheque will be sent to the customer by registered post/local delivery without delay.

6.    SERVICE CHARGES:
For all collection services the bank will recover appropriate service charges as decided by the bank from time to time and communicated to customer thru notice board at branches and/or thru bank’s website www.kangrabank.com .

7. CHEQUE RETURN CHARGES

Cheque return charges shall be levied only in cases where the customer is at fault and is responsible for such returns. The illustrative, but not exhaustive, list of returns where the customers are not at fault is given below :

Illustrative but not exhaustive list of objections where customers are not at fault

(Applicable for Instrument and Image-based Cheque Clearing as detailed in Annexure D to Uniform Regulations and Rules for Bankers' Clearing Houses)

Code No.	Reason for Return
33	Instrument mutilated; requires bank's guarantee
35	Clearing House stamp / date required
36	Wrongly delivered / not drawn on us
37	Present in proper zone
38	Instrument contains extraneous matter
39	Image not clear; present again with paper
40	Present with document
41	Item listed twice
42	Paper not received
60	Crossed to two banks
61	Crossing stamp not cancelled
62	Clearing stamp not cancelled
63	Instrument specially crossed to another bank
67	Payee’s endorsement irregular / requires collecting bank's confirmation
68	Endorsement by mark / thumb impression requires attestation by Magistrate with seal
70	Advice not received
71	Amount / Name differs on advice
72	Drawee bank's fund with sponsor bank insufficient(applicable to sub-members)
73	Payee's separate discharge to bank required
74	Not payable till 1stproximo
75	Pay order requires counter signature
76	Required information not legible / correct
80	Bank's certificate ambiguous / incomplete / required
81	Draft lost by issuing office; confirmation required from issuing office
82	Bank / Branch blocked
83	Digital Certificate validation failure
84	Other reasons-connectivity failure
87	‘Payee's a/c Credited' - Stamp required
92	Bank excluded

Cheques that need to be re-presented without any recourse to the payee, shall be made in the immediate next presentation clearing not later than 24 hours (excluding holidays) with due notification to the customers of such re-presentation through SMS alert, email etc.

8.      FORCE MAJEURE

The bank will not be liable to compensate customers for delayed credit if some unforeseen  event  including but not limited to civil commotion, sabotage, lockout, strike, or other labour disturbances, accident, fires, natural disasters or other “ Act of God”, war, damage to banks facilities or of its correspondent bank’s, absence of usual means of communication  or all types of  transportation etc beyond the control of the bank prevents it from  performing its obligations within the specified service delivery   parameters.

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