Cheque Imaging and Truncation System (CITS):

Cheque Truncation is a system of cheque clearing and settlement between banks based on electronic data or image or both without physical exchange of instrument. It is a paperless electronic image based cheque clearing solution. In this new system physical presentation of cheque is avoided to drawee banks thereby clearing and settlement process will be improve tremendously. Bank will provide data and both side image of a cheque using a software system as per guideline of Bangladesh Bank.

What is BACH?

Bangladesh Automated Clearing House (BACH) the automation of the country's banking and clearing system. As a part of the central bank scheme BACH is likely to introduce the clearing system more speedily, securely and efficiently in the banking sector through electronic media considering the standardized system for all banks in Bangladesh.

BACH network will be the highly reliable and efficient nationwide batch-oriented electronic funds transfer system govern by the BACH Operational Rules which provide for the inter bank clearing of electronic payments for participating financial institutions.

The system will be run by using a special software and hardware through a Core Banking Solution (CBS) where the data will be integrated accordingly. At the same time link is a must of a bank with the Bangladesh Bank to export and import data.

In this regard Bangladesh Bank is taking necessary steps in the following manner:

• Preparation of a Manual/Guideline for Automated Clearing House (ACH) and Electronic Fund Transfer (EFT)
• Standardization/personalization of Cheque, Pay Order, Demand Draft, Dividend Warrant and other nature of instrument
  
• Define transaction code numbers against the nature of instrument and transaction to be made under the process
• Provide routing number against each and every branch of all banks
• Ascertain how to handle fraud and forgery under the guideline of Negotiable Instrument Act
  
• Provide PBM (Participatory Bank Module) Software the Gateway for all the bank under which the system will be operated
• Establish a location for Disaster Recovery Centre (DRC) of Bangladesh Bank

What is MICR?

Magnetic Ink Character Recognition (MICR) is a recognition technology based on the characters printed with the magnetic ink or toner and processed by being magnetized and sensed magnetically. MICR characters are printed information on documents so that the code line information can be captured by magnetic recognition.

In the bottom line on all cheques printed and used in many counties worldwide is printed using a specific fonts like CMC-7 or E-13B using the special ink called magnetic ink. MICR line on a cheque allows the cheque information to be automatically read by inexpensive scanner/reader machine. This is the only way the huge numbers of cheques can be processed each day.

In the MICR line following codes are used:

• Cheque serial number
• Bank's routing numbers
• Account number
• Transaction code number

Security Cheque Paper's Specification

As per Bangladesh Bank guideline banks are printing cheques from the vendors maintaining the security features with the coverage of in house requirement of the bank as well. Following are the features of cheque papers:

• Chemically Sensitized Security cheque paper, CSB 1 (Central Bank Security Standard 1)
• Vendors own watermarked Security paper
• Weight of cheque 95 gsm (+/-5%)
• Thickness of cheque papers 110 mm (+/-5%)

Security Features & Security Controls on cheque leafs are as follows:

• Erasable Security Ink on the surface of the cheque leaf
• Erasable UV (Ultra Violet) features using the " Bank Name"
• Micro Print Security Text " Bank Name "
  

Post Dated Cheque:

When a cheque that carries a date later than the date on which it was written by the drawer then the cheque is called post dated cheque. A post dated cheque is a irregular bill of exchange. Therefore, the cheque can not make payment by the bank until the cheque is presented on the particular date or after to the paying bank.

Stale Cheque:

When a cheque is issued mentioning a date but presented at the counter of paying bank after a certain period i.e after the period of six months for payment then the instrument is called as state cheque. A bank can not make payment such cheque as it is deemed an irregular Bill of Exchange. Therefore, a bank may refuse to honor it unless its drawer reconfirms it payment either by inserting a new payment date with his valid signature or by issuing a new cheque.

Dormant Account :

Generally when a bank account has no transaction for a long period of time then the said account kept in different status called as dormant. If there is no activity in a current account for one year or in a savings account there is no activity for two years then the status of account defined as dormant. A banker has an obligation to intimate customer through a letter mentioning the status of the account with a request to regularize the same by depositing and or withdrawing fund from the respective account.

To activate the dormant account the customer must provide a written request addressed to the branch manager to make the account as regular for transaction.