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Sri Lanka Rupee Cheque Clearing (SLRCC)
Overview of Cheque Imaging &Truncation (CIT)
With an objective of strengthening the National Payment Infrastructure, Cheque Imaging & Truncation (CIT) Project was realized as a brain child of the Central Bank of Sri Lanka (CBSL) in facilitating a secure and efficient retail payment system across the country.This does not mean, however, replacing the traditional form of cheque clearing but minimizing risks associated with various means of retail payments, strengthening processing efficiency, expanding accessibility and when well exploited, redefining commerce across the nation. Currently, cheque clearing process takes 1 to 7 days based on the geographical location of cheque deposit, yielding a social indifference. As a means to curb this disparity in retail transactions across the nation, imaging technology is being induced to realize funds the following day from any geographical location across the nation.
The Payment & Settlement System Act No. 28 of 2005 has laid down the procedure for the payment of cheques electronically presented. Cheque Imaging & Truncation (CIT) is an image-based cheque clearing system, which replaces the physical cheque with electronic information, flowing throughout the clearing cycle. This process eliminates the actual cheque movement in cheque clearing and reduces the delays associated with the physical movement of cheques. CIT system is designed to accept physical cheques or images and MICR data of physical cheques either submitted on CD-ROMs or by direct electronic transfer. Those Banks with necessary technology to generate images of cheques for outward delivery will be able to submit cheque data and images on CD-ROM or transfer electronically while those Banks without the technology will continue to submit cheques in physical form to one of the 11 LankaClear Regional Centers for imaging services. As such, the physical movement of cheques will be truncated at the point of image capture and hence, the paying Bank will NOT receive a physical cheque during the entire clearing process.
How will cheques be processed using imaging?
Current account customers will continue to write cheques as we currently do, and when we receive cheques we will deposit them at our banks as usual (e.g., at the branch or through an ATM). Banks for the most part will follow their current practices of delivering deposited cheques to their processing centre to encode the amount of a cheque on the MICR code line. From that stage, the clearing process will change as encoded cheques will, either be sent to one of
LankaClear’s Regional Centers for imaging or banks with imaging technology will capture a digital image of the front and back of a cheque and instead of shipping the actual physical cheque, data captured from the cheque and the image file will be directly transmitted/forwarded via a CD-ROM to LankaClear for clearing.
LankaClear will then sort and forward the sorted inward images and data to the respective banks that holds the account on which the cheque was written, referred to as the Paying Bank. As “time in transit” for the electronic files will be virtually instant, paying bank will have access to the cheque images and data much faster to decide on whether to honour the cheque based on this electronic information.
After the image has been captured and forwarded to the Paying Bank, original paper cheque will no longer serve much purpose for clearing. Shortly after the usability of the image has been confirmed, the image truncation center (bank with imaging technology or a LankaClear Regional Center) in possession of the paper cheque will forward the physical cheques for temporary storage. Most likely, those Banks with imaging technology will offer a form of on-line access to images as part of the electronic banking services and/or images may be offered on CD-ROM for business customers with high volumes of cheques.
CIT Procedure Manual
Cut off periods
Glossary of terms
SL Rupee Cheque Clearing Procedure Manual
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