Reserve Bank of India has clarified that the new directive that has been brought about on cheque alterations is applicable for cheque truncation system (CTS).

CTS is currently only operative in the clearing house of RBI located in the National Capital Region (NCR). The clearing houses in other places use the MICR method for clearing cheques. The new directive of RBI on cheque alteration is not applicable for clearance done using over the counter, MICR , non MICR techniques.

RBI has said that CTS would come into effect from 1 December, 2010.

The apex bank is taking steps to clear the air on the confusion which had arised regarding its new directive on cheques titled, ‘CTS-2010 Standards for Cheques'.

CTS would be effective only in NCR from December, where a pilot project is under operation. It was earlier planned that CTS would be implemented in all the four metro cities, but it is yet to be set up in Kolkata, Mumbai and Chennai.

The RBI has thus clarified that customers outside NCR need not worry on the new directive.