The Reserve Bank of India (RBI) has authorised co-operative banks to collect account-payee cheques from co-operative credit societies provided the payees are constituents of the credit cooperatives.
This is being done to ease the difficulties faced by co-operative credit societies that are not even sub-members of clearing houses, RBI said in a release today.
Members of such co-operative credit societies who do not have bank accounts face difficulties in collection of account payee cheques drawn in their name.
Cooperative banks may consider collecting account payee cheques drawn for an amount not exceeding Rs50,000 to the account of their customers who are co-operative credit societies, if the payees of such cheques are the constituents of such co-operative credit societies, RBI clarified today.
While collecting the cheques, banks should, however, obtain a clear undertaking in writing from the co-operative credit societies concerned that, upon realistion, the proceeds of the cheques will be credited only to the account of the member of the co-operative credit society who is the payee named in the cheque.
"This will be subject to the fulfillment of the requirements of the provisions of Negotiable Instruments Act, 1881, including Section 131 thereof," RBI noted.
The collecting banks and the cooperatives should, however, strictly follow KYC (Know Your Customer) norms and enter into an agreement that the KYC documents in respect of the society's customers are preserved in the society's records and are available to the bank for scrutiny.
This should not, in any way, affect the rights of the true owner of the cheque in any manner and banks should establish that they acted in good faith and without negligence while collecting the cheque in question, RBI added.