Cheque Truncation System (CTS) is an RBI-led initiative for faster clearing of cheques. CTS promises to bring multiple benefits to customers by substantially reducing the time taken to clear the cheques as well as to the banks by enabling them to offer better customer service and increasing operational efficiency by cutting down on overheads in physical clearing. In addition CTS also offers better reconciliation and fraud prevention. CTS uses cheque image, instead of the physical cheque itself for clearing. The cheque image is truncated at the presenting bank. Subsequently, the cheque image moves through various steps in the cheque-clearing cycle and transactions are settled on the basis of images and electronic transactions.
A CTS solution based on a Business Process Management (BPM) platform provides the required flexibility and speed of implementation to derive true benefits of the CTS initiative. The utility of a traditional CTS system is limited to cheque truncation, while a BPM based CTS solution addresses all types of CTS needs, such as cheque exchange for Central Banks, cheque truncation for branches and service branches, transportation and security for data transfer from branches to service branches, or to the Central Bank, cheque processing for inward/outward clearing, scanning and image quality analysis.
Applying the BPM approach to CTS implies separating the process layer from the application layer. By separating process logic from underlying applications, BPM enables banks to derive ROI from the investments they have already made, in underlying enterprise applications, by virtue of the following:
It is suitable for any deployment model such as Centralized, where both inward and outward clearance is done at service branch, De-centralized, where all operations are performed at branches, or Hybrid model where outward clearance is done at cluster branches and inward clearance is done at the centralized location.
Bio: Virender Jeet, Senior Vice President, Technology, Newgen Software Technologies, has been associated with design and development of various products at Newgen. Being part of the founding team of Newgen, he has been closely associated with complete lifecycle of products development at Newgen.
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