RBI makes SMS alerts for cheques mandatory

MUMBAI: Banks will now start sending SMS alerts to both payer and drawer in cheque transactions as soon as the instruments are received for clearing. Expressing concern over the rise in cheque-related fraud cases, the Reserve Bank of India (RBI) has made SMS alerts mandatory for such transactions. RBI has also asked banks to alert a customer with a phone call and obtain confirmation when dealing with suspicious or high-value cheques. Until now, SMS alerts were mandatory only for card transactions. "The rise in the number of cheque-related fraud cases is a matter of serious concern. It is evident that many of such frauds could have been avoided had due diligence been observed at the time of handling and/or processing the cheques and monitoring newly-opened accounts," RBI said in a circular to all banks. RBI has told banks that clearing cheques should not be a mere mechanical process and banks should bestow special attention on the quality of equipment and personnel deployed for cheque clearing. TOI