Banks to clear cheques same day

Dubai: Banks will be able to clear cheques the same day from November 14, the UAE Central Bank said on Tuesday in a statement.

The Image Cheque Clearing System (ICCS), a fully computerised cheque clearing system that has been in operation since July 2008, processes an average of 100,000 cheques daily.

"With effect from November 14 ... it will be possible for cheques to be cleared in the same business day. Cheques deposited at banks before 10am will be cleared at 5pm on the same business day. Cheques deposited after 10am will be cleared the following business day. This enhancement is expected to benefit bank customers throughout the UAE," the statement said.

The ICCS system processes the electronic details of the cheque and sends these details for authorisation by the issuing bank within seconds of being received into the Central Bank's system.

The ICCS uses secured electronic cheque images, not the physical cheques themselves. This means that banks scan deposited cheques at the branch level all over the UAE and send the images to the Central Bank's system. Physical cheques will stay with the banking system.

The Central Bank urged banks to implement electronic messaging channels to inform customers when cheques are cleared successfully or returned.