What does cts stand for?
- CTS stands for Cheque Truncation System. It is a project launched by the reserve bank of India for faster clearance of cheques. It is basically an image-based cheque clearing system that uses cheque images to clear the cheque. It does not need a physical transfer of the cheque for clearing.
- Truncation in itself means to cease the flow of physical cheques. Cts improves the whole process of cheque clearing system and benefits both parties
Why is cts needed?
Cts speeds up the process of collection and clearing of cheques and results in better customer service cutting down the clearing cycle, reducing the scope of losing valuable instruments in transit, lowers the cost of collection of cheques, and removing logistics-related problems. Thus, it improves the system as a whole. The RBI is offering various other products and has created the capability to create inter-bank and customer payments online.
What is the entire process of cts?
1. In the process of cts, the specified bank branch you are associated with will capture the image and all the other details of your cheque through the capture process of a bank. CTS is an internal process of a bank. The bank has to capture the image of the cheque with specified details to use for clearance
2. A term called public key infrastructure has been implemented in cts. It ensures the safety, security, and non-repudiation of data. Then as per the process, the collecting bank sends the image of the cheque duly signed and encrypted to the central process location which sends the cheque further ahead to the destination or paying bank.
3. Paying banks are equipped with a system called the clearinghouse interface that helps in transferring data and images in a safe and secure manner to the clearinghouse. The clearinghouse then processes the data, decides the settlement figure, and redirects the images and data to the paying banks.
4. The CHI of the paying banks produces the return file for unpaid instruments. The return files are then sent back and go through the same process and are cleared by the clearinghouse in the return clearing session.
5. The clearinghouse cycle is considered complete only when the presentation clearing and return clearing session are successfully completed. The whole process of the cts system relies on the essence of images and data captured online.
What are the advantages of cts?
- No physical movement, therefore, faster-moving of cheques.
- Clearing related frauds become less feasible
- Cheques cannot be lost in transit
- It saves time money and manpower.
- Cheques coming from different cities can be cleared on the same day
- Cts system is very advanced
What are the precautions while using cts?
- Customers should always make sure that their banks use CTS 2010 cheques.
- Use pens that are made of image friendly ink and error-free reading
- Refrain from overwriting on cheques
- In case of an error while writing the cheque use a new cheque leaf
How many cts grids are there in India?
CTS project is categorized into three grids in Delhi, Mumbai, and Chennai to manage cheque processing in the country. The north-based grid is located in Delhi, the south-based grid is located in Chennai and the west-based grid is in Mumbai. It was first implemented in the capital region followed by south and west grids
Areas under various grids;
New Delhi:
Delhi NCR, Haryana, Punjab, Uttar Pradesh, Uttrakhand, Bihar, Jharkhand, Rajasthan, and Chandigarh.
Mumbai:
Maharashtra, Goa, Gujarat, Madhya Pradesh, and Chattisgarh
Chennai:
Andhra Pradesh, Telangana, Karnataka, Kerela, Tamil Nadu, Odisha, West Bengal, Assam and Puducherry
What is the history of cts in India?
The cts system was first implemented in the national capital region by the reserve bank of India in 2008. It was then expanded and implemented in Mumbai and Chennai. From 31st December 2013, only CTS -2010 cheques have been accepted all across India.
What are the image specifications required for cts?
Specific scanners are used to take photos of the cheques. Cheque images can be black and white,grey-colored, or colored. The colored image is perfect but uses more network bandwidth and increases storage. There are 3 images of each cheque to be taken front grayscale, front black and white, and back black and white.
CONCLUSION
The above article summarizes everything you need to know about the cts model. It covers everything from the full form of cts, why was the cts model implemented, the process of cts, precautions to be taken, advantages of cts, no. of cts grids in India, history of the Cts model, and the image specifications required for the cts system.
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