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Operational Aspects of Handling Clearing & Collection & Cash
What is the primary purpose of the Cheque Truncation System (CTS) introduced by RBI?
CTS eliminates the physical movement of cheques by transmitting electronic images of cheques between banks, speeding up the clearing cycle and reducing operational risk.
What is the meaning of 'clearing house' in banking operations?
A facility where banks exchange and settle interbank payment instruments.
What does the term 'clearing' mean in the context of banking operations?
Clearing is the process by which inter-bank claims arising from cheques and other instruments are settled through a centralized mechanism, typically managed by the Reserve Bank of India or a designated clearing house.
What is the maximum validity period of a cheque issued in India?
Three months from the date of issue.
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