Central Bank of Kenya(CBK) in partnership with the Kenya Bankers Association(KBA) have embarked on a cheque truncation project that will see the banking system switch to a more efficient way of clearing cheques.
Speaking to the press at the Bankers Association headquarters yesterday, the Chief Executive Officer of the association, Habil Olaka, said that the new system will see customers receiving their funds into their accounts faster than the previous system which was characterised by a lot of channels that delayed the cheques transfer.
“Once the system is fully operational, the payee of the cheque will receive it in a much shorter period,the previous system’s chain required the actual physical movement of cheques from clearing house to the settlement information back through the clearing house,” explained Olaka.
The new system is viewed to take an image of the front and back of the cheque, and then transmitted to the channel with the cheque details.
Olaka said the system will make the truncation process faster as opposed to the manual system which he said was slow, inefficient and posed security risks to the cheques, adding that the new system comes handy with new features to ensure the cheques are tamper proof. At the same time Olaka called on customers to heed to the call come August 15th the official day for facing out the old system of cheque transfer and urged those who have not yet collected their new design cheques to do so before the 21 days deadline for clearing the old cheques.
“Since the new system is electronic, it makes the process faster, more efficient, safer and as a result curbs fraud. The cheque processing fees will also come down and customers will be able to realize profits.We appeal to those who have not collected their cheques to do so and start using them,said Olaka.
According to the KBA statistics,95 per cent of the new cheques books have been printed and are ready for issuing and use.
At the same time the CBK,s Governor Njuguna Ndung’u lauded the associations efforts saying that protection of customer and providing efficient services is paramount.
“In today’s first paced electronic environment, the banking sector remain at the fore front of protecting customers and ensuring efficiency in service delivery while minimising risks to their transactions,” said Ndung’u.
On the claims that many customers were unaware of the information on changes in the system,Olaka said that the association has formed communication strategies that will see all customer aware.
“We are aware that some of our customers were not aware of the changes, however we are improving on the strategies laid to ensure we reach them all,”he said.
The association will merge the local and up country zones to one clearing zone of 3 days upon going live, and will subsequently run down to 2 and 1day clearing period upon the the start of the system. This is expected to show massive improvement of the upcountry cheque holder. Earlier the local and up-country clearing zones took a period of 3 and ten respectively.
Olaka said :“The new cheques trancation system will cater for both the Kenyan shilling and Domestic foreign currency cheques drawn on kennyan banks., however the clearing process of foreign cheques drawn out of kenya will not be affected.”