Preventing fraudulent activities in banks is vital to protect financial assets and maintain customer trust.
By implementing stringent security measures, staying ahead of evolving fraud tactics, and educating customers about potential risks, banks can shield themselves and their customers from financial losses, legal complications, and damage to their reputation.
All the while, ensuring a smooth and secure banking experience for everyone.
SBI’s New Cheque System
The State Bank of India (SBI) has introduced the Positive Pay System, a robust security measure designed to combat check fraud. This system aims to thwart frauds carried out through check tampering and alteration. It involves verifying key details of a check by the account holder with the bank, which are cross-checked when processing payments.
Compliance with RBI Directives
As per directives from the Reserve Bank of India (RBI), SBI has implemented the Positive Pay System (PPS) for all modes of check payments, including cash, transfers, and clearing, starting from January 1, 2021.
The Positive Pay System is a valuable security measure that provides customers with peace of mind regarding the safety of their checks. It’s a straightforward and user-friendly system.
How the SBI Positive Pay System Works:
1. Account Registration
Customers interested in using this facility need to register their check-operated accounts for the Positive Pay System through their nearest branch. They can submit an application in the prescribed format. Registration is also possible through alternate channels such as Retail Internet Banking (RINB), Corporate Internet Banking (CINB), Mobile Banking (YonoLite), and the YONO mobile app. Customers can select an account level limit for registration based on their risk perception.
2. Lodgment of Cheque
Once registered, customers must provide the following details for checks issued at or above the selected account level limit to the Positive Pay System:
- Account Number
- Cheque Number
- Cheque Date
- Cheque Amount
- Beneficiary (Payee) Name
- Instrument Type (Two-digit number on the right bottom of the MICR band)
Customers can lodge their checks through branches or alternate channels, such as RINB, CINB, Mobile Banking (YonoLite), YONO (Mobile App), and SBI Quick (SMS).
Upcoming Mandatory Requirements
SBI plans to make the Positive Pay System mandatory for Savings Bank account checks of Rs. 5 lakhs and above, as well as all other account types (Current Account/Cash Credit/Overdraft) checks of Rs. 10 lakhs & above.
Once these mandatory clauses take effect, the maximum account level limits will align with the specified amounts. Any registrations exceeding these limits will be adjusted accordingly on the effective date.
So, The SBI Positive Pay System is a proactive measure that enhances the security of banking transactions and bolsters trust between banks and customers.
By simplifying the process and offering robust safeguards, SBI continues to lead the way in secure banking practices.