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The Bankers Association of Malawi has announced that it will computerise the whole cheque clearing process countrywide by implementing a new electronic cheque clearing house (ECCH) in the first quarter of 2005.
In a press statement published in the media Monday, the association says the introduction of ECCH will result in certain changes for the banking public as well as the banks themselves.
“The ECCH will be driven by the latest sate-of-the-art computer system and in terms of clearing processes will place the banking industry in Malawi amongst most advanced countries in the world,” reads the statement.
The statement further says ECCH has faster clearance times between branches of different banks which will still be the 48 hour clearing period as a cheque issued within the same bank. It has also a greater efficiency in the banking sector leading to improved customer service and also reduced fraud as a cheque processed and verified electronically rather than manually.
The introduction of the ECCH will affect the bank’s customer current (cheque) account customers, paid cheque will no longer be returned to customers but an image of every paid cheque will be printed on customer statements, customers are urged to utilise only Magnetic Ink Recognition (MICR) encoded cheques.
“All the data capture for the ECCH process relies primarily on MICR scanners which input the majority of required information reading the MICR code line of each cheque.
“If the cheques are not MICR encoded or the MICR code line is damaged in any way, then electronic scanning will not be possible and data will have to be captured manually, in this event processing ineffiencies will result, and there is a possibility penalty charges could be passed on to customers who cause banks to resort to manual data capture,” reads the statement.
The association warns the banking public in the country to be aware that with effect from January 1, 2005 any non encoded cheques presented for payment will not be accepted and will be returned unpaid to depositors.
The statement concludes that in weeks leading up to the implementation of ECCH the association as well as individual banks will engage in further communications to sensitise the public about ECCH.
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