Module: | KYC, NPAs, Advances & Investment Valuations
Q203: Consider the following statements regarding cheque operations and dishonour management guidelines:
1. Banks must print all cheque forms strictly in Hindi and English, but customers are permitted to write cheques in Hindi, English, or the concerned regional language.
2. In the event of a cheque dishonour, the instrument must be returned or dispatched to the customer promptly, and in any case within a strict 24-hour window.
3. The bank's internal policy must specifically address the frequent dishonour of cheques of value less than ₹1 crore, as well as ECS and NACH mandates.
4. Data concerning each dishonoured cheque for an amount of ₹50 Lakhs and above must mandatorily form part of the bank's MIS and be reported to the controlling office.
Which of the statements given above is/are correct?
2. In the event of a cheque dishonour, the instrument must be returned or dispatched to the customer promptly, and in any case within a strict 24-hour window.
3. The bank's internal policy must specifically address the frequent dishonour of cheques of value less than ₹1 crore, as well as ECS and NACH mandates.
4. Data concerning each dishonoured cheque for an amount of ₹50 Lakhs and above must mandatorily form part of the bank's MIS and be reported to the controlling office.
Which of the statements given above is/are correct?
✅ Correct Answer: B
The correct answer is B. Statement 1 is correct: The operational guidelines mandate the bilingual printing of cheque forms (Hindi and English) while legally granting customers the flexibility to fill them out in any recognized regional language.
Statement 2 is correct: The regulatory framework imposes a strict 24-hour turnaround time for returning or dispatching dishonoured instruments back to the customer.
Statement 3 is correct: The mandate requires internal bank policies to explicitly deal with the frequent dishonour of smaller value cheques (less than ₹1 crore) and automated recurring mandates like ECS and NACH.
Statement 4 is incorrect: The directives dictate that the threshold for mandatory MIS inclusion and official reporting to the controlling office for dishonoured cheques is exactly ₹1 crore and above, not ₹50 Lakhs.
Statement 2 is correct: The regulatory framework imposes a strict 24-hour turnaround time for returning or dispatching dishonoured instruments back to the customer.
Statement 3 is correct: The mandate requires internal bank policies to explicitly deal with the frequent dishonour of smaller value cheques (less than ₹1 crore) and automated recurring mandates like ECS and NACH.
Statement 4 is incorrect: The directives dictate that the threshold for mandatory MIS inclusion and official reporting to the controlling office for dishonoured cheques is exactly ₹1 crore and above, not ₹50 Lakhs.