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New bank check clearing rules take effect next week

First Posted 07:48:00 01/20/2011

STARTING Monday, banks will be implementing changes in the clearing of checks as mandated by Bangko Sentral ng Pilipinas Circular Nos. 681 and 705, otherwise known as the ?Revised Check Clearing and Settlement Processes.?

In a statement, Chito B. Cabaero, president of the Cebu Bankers Club, said the new check processing requires all banks to return unfunded checks not later than 7:30 a.m. the following banking day after they are deposited or presented for clearing.

Cabaero said the public should take note of the new rules to avoid charges as the changes will have a significant impact on the current practice of clients in managing their checking accounts.

According to Cabaero, upon effectivity of the said circular, checks with insufficient balance or drawn against insufficient funds (DAIF), checks with stop payment order (SPO) including SPO-funded, SPO-DAIF, SPO-DAUD or drawn against uncleared deposits as well as other regular return items including closed or non-existent accounts shall be automatically returned not later than 7:30 a.m. the following day after the check is presented for clearing.

?This means that current accountholders will no longer have the chance to fund checks with insufficient balance on Day 2 or the day after the check is presented for clearing. Account holders with unfunded checks will then be charged a service fee of P2,000 plus a returned check fee of P200 for every P40,000 or fraction thereof of the check amount per day,? he said.

Being busy and having no time to go to the bank for over-the-counter deposits is no longer a valid reason as most banks have set up online banking system which allows accountholders to transfer funds to their checking accounts.

?Checking accountholders will only be able to fund any deficiencies via fund transfers using electronic channels like internet banking , phone banking, mobile banking and through automated teller machines (ATM) before the cut-off time prescribed by your bank on the same day when the payee deposited or presented the check to the bank.? he said.

Cabaero added that an account holder could still apply for Stop Payment Order (SPO) provided the check had not been accepted, negotiated, encashed and charged to their accounts yet.

The clearing period for checks will still take three days for local checks and seven banking days for regional checks.

?We encourage you to monitor your checking accounts and ensure that all issued checks are sufficiently funded on the date of issuance, to avoid penalties. If you have questions or require further clarification, feel free to contact your bank or visit the branch near you,? Cabaero said.

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