Home Bounced Cheque What are Cheque Return Charges?

What are Cheque Return Charges?

November 17, 2016

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Charges that are levied by bank when there is a fault by the drawer refers to cheque return charges when such a thing happen both the drawer and drawee is liable to pay the cheque return charges. Cheque return and cheque bounce is one of the same thing. Generally the cheque return charges ranges from 200 rupees to 800 rupees depending on various banking company. Even Adhil Shetty, founder & CEO of BankBazaar.com said that “The penalty charges for cheque outward return are close to Rs 300 for most banks, while charges for cheque inward return are about Rs 100. The exact penalty charges vary with banks and are different for different account types. Premium accounts usually have higher penalty charges.

These charges are present because when a cheque is bounced bank undertakes more work and labour than they usually take thus these charges are the fee for the extra work that has been put by the bank. The charge that drawee’s bank charges the drawer is the known as the outward return cheque & the amount that the presenting bank i.e. where the cheque was deposited, charges the payee for the inward return cheque. Generally the inward return cheque charge are less than the charge that is payable by the drawer.

As per RBI notification, the regulating authority have made it clear that the banks cannot impose the cheque return charges when the bank was at fault and there was no mistake from the customers’ side and when there is such a fault than bank must resolve the issue and pass the said cheque within 24 hours all this was done by RBI while exercisingits power under Section 18 of the Payment and Settlement Systems Act, 2007.

A picture speaks louder than a thousand words, following the said quote the following image clearly display what is the cheque return charges policy that is followed by prominent banks in India.