Cheque Truncation System (CTS) aims to make cheque clearance more efficient and reduce the clearance time of cheques to one day, thereby trimming down the floating time considerably. India processes as many as 1.2 billions cheques annually and therefore, the implementation of this system would drastically cut down the waiting period involved. The system will be implemented nationwide from April 1, 2013.

Sample CTS Cheque

An online image-based cheque clearing system, the collecting bank branch would deploy scanned images along with the magnetic ink character (MICR) of the cheque which will be sent out electronically using their Capture System, removing the need for physical/manual transfer of cheques. The captured images and the data is then signed and encrypted and sent to the Clearing House or the central processing location and thereafter forwarded to the drawee or paying bank.

Have you wondered why bank has been sedning SMS and call to replace your old cheque book before 1 JAN 2013. the answer is INDIAN bank is moving toward faster and quicker Cheque Clearnce method. This new cheque system is called CTS which stands for Cheque Truncation System
Earler with the instruction of RBI this project was tested as pilot project with some banks across few location in INDIA finally RBI has made it mandatory to use CTS enable cheque book
In this  system the Cheque will be cleared in a day which normally takes days days on an average.
In present context all the cheques are sent directly physical to the respective  bank  to which cheque bleongs to for clearance, but in  this new  System , the banks will send the digital version of cheques to the other bank and the clearance will be done almost same day

Here are few feature listed below by which you can identify whether your cheque book is CTS enable or not

1) All CTS-2010 Cheques will have a watermark with the words “CTS INDIA”, which can be seen against a light

2) It should have a bank logo that will be on cheque with a Ultra Violet Ink , which can be seen only under UV Scanners.

3) The Cheque Truncation System 2010 enabled cheques will not allow any alterations. If there is any mistakes, the cheque will be invalid

4) It should have text  at the bottom of all the cheques “payable at par at all branches of the bank in India”

5) It should have  IFSC and MICR code on the cheque

6) Sign the cheque will a darker ink, so that your signatures are valid for scanning.

7) It should have the wordings “please sign above this line” at right bottom