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Wednesday, May 13, 2009

Rs 1 Lakh cheque is no longer 'high value'

(13/5/09 Indian rupee updates) - One lakh rupees is no longer considered 'high value' in banking parlance. Until recently, a cheque amounting to over a lakh was considered high value and would be swiftly cleared on the same day itself, if deposited before 11 am. Now that a lakh is no longer what it used to be, although it can still buy you a car, the Reserve Bank of India has raised the bar.

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As of May 2, a cheque will have to be above Rs 5 lakh, and after August 1, above Rs 10 lakh for it to qualify as 'high value'. From November 1, there will be no high value clearing. For same-day clearance, banks are advising their customers to fill in a special form and use RTGF (Real Time Gross Settlement) or NEFT (National Electronic Funds Transfer).

"The idea is to facilitate easier transactions by getting into electronic clearing," says a RBI spokesperson. "Earlier, we made the transfer of amounts over Rs 1 crore mandatory through electronic clearing. We are gradually moving towards all transactions being cleared electronically."

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