Banks told to pay for delay in cheque clearance

Banks have to credit local cheques to your account the same day or at the most the next day, the national consumer court has ordered, reports Satya Prakash.

Banks have to credit local cheques to your account the same day or at the most the next day, the national consumer court has ordered. And outstation cheques have to be encashed between seven and 14 days, depending upon the distance from the place where the cheque is issued.

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You can claim interest from a bank for delayed encashment of your outstation cheques. “If there is any delay in collection of the said (outstation) cheques beyond the period… interest at fixed deposit rate, or at a specified rate as per the respective policy of the banks, is to be paid to the payee of the cheques,” the National Consumer Disputes Redressal Commission said in its July 14 order.

Advocate Atul Nanda, on whose petition the landmark judgment came, said banks would have to pay interest to customers for delayed encashment of local cheques as well. It usually takes up to three days to be encashed. In his consumer interest litigation, Nanda had said the delay in crediting the cheques to the customers’ account was leading to “undue enrichment” of banks, which were earning crores in interest on the customers’ money for the delayed period.