History

Late Sri Ammembal Subbarao Pai

Our Beloved Founder

Founded as 'Canara Bank Hindu Permanent Fund' in 1906, by late Shri Ammembal Subba Rao Pai, a philanthropist, this small seed
blossomed into a limited company as 'Canara Bank Ltd.' in 1910 and became Canara Bank in 1969 after nationalization.

"A good bank is not only the financial heart of the community, but also one with an obligation of helping in every possible manner to improve the economic conditions of the
common people" - A. Subba Rao Pai.

Founding Principles
1.

To remove Superstition and ignorance.

2.

To spread education among all to sub-serve the first principle.

3.

To inculcate the habit of thrift and savings.

4.

To transform the financial institution not only as the financial heart of the community but the social heart as well.

5.

To assist the needy.

6.

To work with sense of service and dedication.

7.

To develop a concern for fellow human being and sensitivity to the surroundings with a view to make changes/remove hardships and sufferings.

Sound founding principles, enlightened leadership, unique work culture and remarkable adaptability to changing banking environment have enabled Canara Bank to be a frontline
banking institution of global standards.

Significant Milestones
Year

1st July 1906

Canara Hindu Permanent Fund Ltd. formally registered with a capital of 2000 shares of

1910

Canara Hindu Permanent Fund renamed as Canara Bank Limited

1969

14 major banks in the country, including Canara Bank, nationalized on July 19

50/- each, with 4 employees.

1976

1000th branch inaugurated

1983

Overseas branch at London inaugurated Cancard (the Banks credit card) launched

1985

Takeover of Lakshmi Commercial Bank Limited Commissioning of Indo Hong Kong International Finance Limited (now a full fledged branch)

1987

Canbank Mutual Fund & Canfin Homes launched

1989

Canbank Venture Capital Fund started

1989-90

Canbank Factors Limited, the factoring subsidiary launched

1992-93

Became the first Bank to articulate and adopt the directive principles of Good Banking.

1995-96

Became the first Bank to be conferred with ISO 9002 certification for one of its branches in Bangalore

2001-02

Opened a 'Mahila Banking Branch', first of its kind at Bangalore, for catering exclusively to the financial requirements of women clientele.

2002-03

Maiden IPO of the Bank

2003-04

Launched Internet Banking Services

2004-05

100% Branch computerization

2005-06

Entered 100th Year in Banking Service. Launched Core Banking Solution in select branches. Number One Position in Aggregate Business among Nationalized Banks.

2006-07

Retained Number One Position in Aggregate Business among Nationalized Banks. Signed MoUs for Commissioning Two JVs in Insurance and Asset Management with
international majors viz., HSBC (Asia Pacific) Holding and Robeco Groep N.V respectively.

2007-08

Launching of New Brand Identity. Incorporation of Insurance and Asset Management JVs. Launching of 'Online Trading' portal. Launching of a Call Centre. Switchover to
Basel II New Capital Adequacy Framework.

2008-09

The Bank crossed the coveted

2009-10

The Banks aggregate business crossed 4 lakh crore mark.

Net profit of the Bank crossed 3000 crore. The Banks branch network crossed the 3000 mark.

2010-11

The Banks aggregate business crossed

3 lakh crore in aggregate business. The Banks 3rd foreign branch at Shanghai commissioned.

5 lakh crore mark. Net profit of the Bank crossed

4000 crore. 100% coverage under Core Banking Solution. The Banks 4th

foreign branch at Leicester and a Representative office at Sharjah, UAE, opened. The Bank raised

2011-12

Total number of branches reached 3600. The Banks 5th foreign branch at Manama, Bahrain opened.

2012-13

Highest Dividend of 130% paid for the year

2013-14

1027 branches and 2786 ATMs opened during the year. Global business crossed the

2014-15

Global Business of the Bank crossed

2015-16

The Bank's 8th foreign branch at DIFC (Dubai) opened.

1993 crore under QIP. Govt. holding reduced to 67.72% post QIP.

7 lakh crore milestone. Switchover to Basel III New Capital Adequacy Framework.

8 lakh crore.

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Profile
A Brief Profile of the Bank
Widely known for customer centricity, Canara Bank was founded by Shri Ammembal Subba Rao Pai, a great visionary and philanthropist, in July 1906, at Mangalore, then a small port
town in Karnataka. The Bank has gone through the various phases of its growth trajectory over hundred years of its existence. Growth of Canara Bank was phenomenal, especially after
nationalization in the year 1969, attaining the status of a national level player in terms of geographical reach and clientele segments. Eighties was characterized by business
diversification for the Bank. In June 2006, the Bank completed a century of operation in the Indian banking industry. The eventful journey of the Bank has been characterized by several
memorable milestones. Today, Canara Bank occupies a premier position in the comity of Indian banks. Canara Bank has several firsts to its credit. These include:

Launching of Inter-City ATM Network

Obtaining ISO Certification for a Branch

Articulation of Good Banking Banks Citizen Charter

Commissioning of Exclusive Mahila Banking Branch

Launching of Exclusive Subsidiary for IT Consultancy

Issuing credit card for farmers

Providing Agricultural Consultancy Services

Over the years, the Bank has been scaling up its market position to emerge as a major 'Financial Conglomerate' with as many as nine subsidiaries/sponsored institutions/joint ventures in
India and abroad. As at June 2016, the Bank has further expanded its domestic presence, with 5847 branches spread across all geographical segments. Keeping customer convenience
at the forefront, the Bank provides a wide array of alternative delivery channels that include 9657 ATMs, covering 4081 centres. Several IT initiatives were undertaken during the year. The
Bank set up 172 hi-tech E-lounges in select branches with facilities like ATM, Cash Deposit Kiosk with voice guided system, Cheque Deposit Kiosk, Self Printing Passbook Kiosk, Internet
Banking Terminal, Online Trading Terminal and Corporate Website Access. Canara e-Infobook an electronic passbook and banking related information facility was introduced on
mobile platforms - Android, Windows & iOS. The Bank also launched Canara Bank RuPay Debit Card, Canara Club Card Debit, Canara Secured Credit Card, Canara Elite Debit Card,

Canara Bank Platinum Rupay Cards, Platinum Rupay Card and EMV Chip Cards under debit and credit cards. Online Savings Bank and PPF account opening were introduced.The Bank
made several value additions under internet banking and mobile banking services. The Bank has introduced enhanced version of CanMobile, Canara e-InfoBook- an electronic passbook
and banking related information facility on mobile platforms - Android, Windows & iOS and Canara m-Wallet to provide more convenience and facilities to customers. Canara Galaxy, a
combo product launched, comprising SB, Demat, OLT, Internet & Mobile Banking, Insurance, card services and other add-ons. Under education loan interest subsidy, web portals
released for Central Scheme for Interest Subsidy (CSIS), Ministry of HRD, GoI, Dr. Ambedkar Central Sector Scheme of Interest Subsidy (ACSIS), Ministry of Social Justice &
Empowerment, GoI and Padho Pardesh, Ministry of Minority Affairs, GoI.

The Bank has launched Instant loan application in principle sanction portal for Housing Loan and Car Loan. The Bank issued MUDRA Debit Card for overdraft accounts under MUDRA
Card scheme. P2U (Person to UIDAI) funds transfer through Mobile Banking in WAP channel was enabled by the Bank. Subscription of Social Security Schemes of Govt. of India through
ATM, SMS and Internet Banking was enabled by the Bank. The Bank has implemented Jeevan Praman a digital life certificate for pensioners. The Bank has Implemented automated
reminder SMS/Email Alerts to customers intimating to submit RC Copy/Insurance for the vehicle loans and tax paid receipt/certificate for the mortgaged property. Missed Call / SMS
Based ePass Sheet generation made live by the Bank. The Bank has successfully implemented SMS/Email Alerts to NPA Borrowers intimating to regularize overdues in accounts. Mobile
Banking Registration through ATMs (Interoperability through NFS) has been successfully introduced by the Bank. Not just in commercial banking, the Bank has also carved a distinctive
mark, in various corporate social responsibilities, namely, serving national priorities, promoting rural development, enhancing rural self-employment through several training institutes and
spearheading financial inclusion objective. Promoting an inclusive growth strategy, which has been formed as the basic plank of national policy agenda today, is in fact deeply rooted in
the Bank's founding principles. "A good bank is not only the financial heart of the community, but also one with an obligation of helping in every possible manner to improve
the economic conditions of the common people". These insightful words of our founder continue to resonate even today in serving the society with a purpose. The growth story of
Canara Bank in its first century was due, among others, to the continued patronage of its valued customers, stakeholders, committed staff and uncanny leadership ability demonstrated
by its leaders at the helm of affairs. We strongly believe that the next century is going to be equally rewarding and eventful not only in service of the nation but also in helping the Bank
emerge as a "Preferred Bank" by pursuing global benchmarks in profitability, operational efficiency, asset quality, risk management and expanding the global reach.

Canara bank mortgage service

Canara Bank Mortgage Service is one of the foremost in the Indian mortgage market. The Canara Bank mortgage
service is an important part of the Canara Bank. The Canara Bank Mortgage service provides very high quality financial
products pertaining to home loans and loans for household purposes. The mortgage market in India is displaying rapid
growth in the past few years. The foremost players in this sector are the finance corporation but presently the commercial
banks are also started playing an important role in the development and growth of the India Mortgage Market. Presently the
total worth of the mortgage market in India is nearly US $ 18 billion. With all this development the ration between the gross
domestic product to mortgage in India is poor when compared to other developed countries. The ratio in India is very low in
comparison to The ratio in the foreign countries ranges from 25% to 60% whereas in India the ratio is 2.5%.

Objectives of the Canara Bank Mortgage Service

To focus on cost management and profits management
To provide the customers with the best services
To put emphasize on the quality of the credit and advance in form of mortgage loan
The purpose of the Canara Bank Mortgage Service is to provide mortgage loans for purchase, expansion, construction,
repairs, and renovations of flats, apartments, residential complexes, purchase of land for the purpose of construction. The
Canara Bank Mortgage service also provides the facility to take over of liability of the customers pertaining to other housing
boards, housing finance companies, co-operative societies, co-operative banks, and commercial banks.
Person below the age of 55 years such as professionals, employees, individual person, self-employed can avail Canara Bank
Mortgage Service. People above that age of 55 years can also take out a mortgage loan but there are some stipulations.
Others people who are income tax assessee and people who are salaried individuals and people who are self employed
individuals. The salaried class can get a maximum of 48 times gross monthly income and others can get a maximum of the
gross annual income of four years. The type of loans given is current account overdraft or term loan. The contribution of the
customer ranges from 15% to 25% of the total loan amount depending on the loan.
The Canara Bank Mortgage Service is provided against collateral security such as residential house or apartment, industrial
property, urban commercial complex, possessed in the name of the receiver of the loan. The security such as rented house
can be accepted if the same property is on a lease and the person should also have the authority to collect the rent under

the power of attorney. - See more at: http://business.mapsofindia.com/india-mortgage/loans/canara-bankservice.html#sthash.WlbppR3y.dpuf

Bank Policies
POLICY ON COLLECTION OF CHEQUES/INSTRUMENTS- 2014-15
1. INTRODUCTION
The cheque collection policy of the bank is a reflection of our on-going efforts to provide better service to our Customers and set higher standards for performance. The policy is
based on principles of transparency and fairness in treatment of the customers. This policy document covers the following aspects.
2. ARRANGEMENTS FOR COLLECTION
2.1 : Local Cheques:

a.

All cheques and other negotiable instruments payable locally would be presented through the clearing system prevailing at the centre. Cheques deposited at branch
counters, Post, Courier and in collection boxes within the branch premises before the specified cut off time will be presented for clearing on the same day. Cheques
deposited after the cut-off time and in collection boxes outside the branch premises including offsite ATM (after introduction of the facility) will be presented in the next
clearing cycle. As a policy, bank would give credit to the customer's account on the same day clearing settlement takes place. Withdrawal of amounts so credited
would be permitted as per the cheque return schedule of the clearing house and wherever applicable facility of high value clearing (same day credit) will be extended
to customers.

b.

Bank branches situated at Centres where no clearing house exists, would present local cheques on drawee bank across the counter and it would be the bank's
endeavour to credit the proceeds at the earliest.

c.

Our bank branches will display the cut off time up to which the cheques received will be sent for clearing on the same day including those cheques dropped in the
cheque collection box provided inside the branch premises.

d.

As the cut off time limit for acceptance of cheques for collection depends on the clearing cycle of the respective centre, cut off time limit at each centre will be fixed,
depending on the clearing arrangement at that place and the same will be displayed at the branches.
(Circles are advised to fix a cut off time limit at each centre depending on the clearing arrangement at that place and advise their branches to display the same in their
branches - Approved by Board vide SPDW CSS BD 19 2010 USB dt. 12/03/2010)

e.

Bank shall permit usage of the shadow credit afforded to the customers account immediately after closure of relative return clearing and in any case, withdrawal shall
be allowed on the same day or maximum within an hour of the commencement of business on the next working day, subject to usual safeguards.

f.

Issue of multicity/payable at all branches cheques by CBS enabled banks:

Considering the availability of processing infrastructure for clearing outstation cheques at all clearing locations across the country and to bring about further efficiency
in cheque clearing, bank shall issue only payable at par/multi-city CTS 2010 standard cheques to all eligible customers Since such cheques (payable at par) are
cleared as local cheques in clearing houses, customers shall not be levied extra charges.

g.

2.1(g) I. Cheque return charges shall be levied only in cases where the customer is at fault and is responsible for such returns. An illustrative, list of returns, where the
customers are not at fault are indicated in the annexure.

h.

2.1 (g) II. Cheques that need to be re-presented without any recourse to the payee, shall be made in the immediate next presentation clearing not later than 24 hours

(excluding holidays) with due notification to the customers of such re-presentation through SMS alert, email etc.,
2.2 : Outstation cheques :
Cheques drawn on other Banks at outstation centres will be normally collected through our bank's branches/ offices at these centres. Where our Bank does not have
a branch of our own, the instruments would be preferably collected through any branch of Public Sector Bank other than the drawee bank at that place, if there is no
branch of public sector bank, through any scheduled bank or branch of any bank at that place. In the absence of the above, the cheque would be sent directly to the
drawee bank. The bank would also use the National Clearing Service offered by the Reserve Bank of India at centres where such collection services exists.
Cheques drawn on bank's own branches at outstation Centres will be collected using the inter-branch arrangements in vogue. Branches connected through central
processing arrangements shall provide same day credit to its customers in respect of outstation instruments drawn on any of its branches in the CBS network.
Credits in respect of cheques drawn between bank's own Core Banking Branches will be done on the same day on receipt of the cheque subject to availability of
connectivity between the branches. In case of other Banks where core banking is enabled, cheques with stipulation of payment at par at all its Core Banking
Branches are presented to the local branch / clearing section of the said bank, else the cheque will be sent for collection to the mentioned drawee bank branch.
2.2.1 : Speed Clearing:
Speed Clearing facility has been introduced at the MICR centers implemented by RBI, for the outstation cheques accepted for collection drawn on other Banks
having CBS inscription on the face of the Cheque / CBS unique Account Number.
Outstation cheques drawn on Banks participating in Speed clearing at specified locations will be collected and treated at par as if they were local cheques. All terms
and conditions applicable for local clearing instruments will also apply to Speed Clearing. However, the charges for collection of speed clearing cheques, shall be
applicable as prescribed by the Bank from time to time.
2.3 : Immediate Credit of Local/ Outstation Cheque/ Instruments & Payment of Interest on Delayed Collection:
The details of the facility are as under;
Eligible Persons : Individuals / joint SB / CA holders and retired employees of our Bank provided

The conduct of the account is satisfactory for at least 6 months.

The Bank has not noticed any irregular dealings in the account.

No cheques / instruments for which immediate credit was afforded returned unpaid for financial reasons.

The bank has not experienced any difficulty in recovering any amount advanced in the past including cheques returned after immediate credit.

Ineligible Persons:

Minors' account whether individually, jointly or represented by natural guardian.

Non Residents

Employees (Both Officers and Workmen) of our Bank

Self cheques, endorsed cheques and Exchange Company cheques.

Eligible Amount :

Not exceeding Rs.15000/- in respect of outstation cheques to all the eligible account holders without any specific request from the account holder.

In respect of local cheques immediate credit of Rs.15000/- will be extended only to those eligible account holder on specific request.

It will be extended in case of dividend warrants / Interest Warrants to all the eligible account holders provided they are drawn on banks and payable on demand
without any pre-condition.
TERMS & CONDITIONS:

Affording immediate credit is restricted to an amount not exceeding Rs.15000/- per eligible account holder. If the eligible account holder has already been
provided with the facility for an amount less than Rs.15000/- (i.e. maximum admissible amount) branch will consider affording further credit within the
overall ceiling of Rs.15000/- provided the eligible account holder tenders the cheque. At any point of time the amount of immediate credit shall not
exceed Rs.15000/- per eligible account holder.

Individual cheques/Dividend warrants/Interest warrants (both Local and Outstation) for amounts exceeding Rs.15000/- are not eligible under the scheme
for affording immediate credit.

Facilities extended in all the branches excepting in certain specialized branches. In such cases, extending further continuation of the facility is sole
discretion of the bank.

In case the cheque is returned unpaid, interest is chargeable from the date of return of such a cheque till the recovery of the amount thereof. The rate of
interest shall be charged as under:

Where the party to whom such immediate credit has been given -

1. Is enjoying / having other limits / liabilities Appropriate rate of interest after determining the size of the limit duly aggregating other limits/liabilities permitted/outstanding.
2. Is not enjoying any other limit / liabilities

Rate of interest as applicable to loans/ advances up to Rs.2 lacs as advised from time to time.

o
o

Appropriate commission and postage shall be collected.

2.4 : Purchase of local / outstation cheques:

Bank may at its discretion, purchase local / outstation cheque tendered for collection at their specific request of the customer or as per prior arrangement. Besides
satisfactory conduct of account, the standing of drawer of the cheque will also be a factor considered while purchasing the cheque.

2.5 Prohibition on collection of account payee cheques for crediting the proceeds to third party account:
3. Time frame for collection of local / outstation cheques / instruments:

1.

For local cheques presented in clearing credit will be afforded as on the date of settlement of funds in clearing and the account holder will be allowed to withdraw
funds as per clearing norms in vogue.

2.

Cheques / instruments presented in high value clearing (with the minimum value of ` 1 lac) shall be credited on the same day (applicable only in areas covered by
high value / same day clearing).

3.

For cheques and other instruments sent for collection to centers within the country the following time norms shall be applied;

a.

Cheques presented at any of the four major Metro centers (New Delhi, Mumbai, Kolkata and Chennai) and payable at any of the other three centers,
maximum period of 7 days.

b.

Metro Centres and State capitals (other than those of North Eastern States and Sikkim) maximum period of 10 days.

c.

In all other centers, maximum period of 14 days.

d.

Cheques drawn on foreign countries:-

Such instruments are accepted for collection on the "best of efforts" basis. The Bank is committed to ensuring that instruments drawn in foreign currencies and
payable outside India are collected in the quickest and most efficient manner. Towards this the bank may enter into specific collection arrangements with its
correspondent banks in those countries for speedy collection of such instrument(s). Bank would give credit to the party upon realization credit of proceeds into the
bank's Nostro Account with the correspondent bank after taking into account cooling periods as applicable to the countries concerned.
The above time norms are applicable irrespective of whether cheques/ instruments are drawn on the bank's own branches or branches of other banks.

4. Payment of interest on delayed collection of Outstation Cheques:

As part of the compensation policy of the bank, the bank will pay interest to the customers on the amount of the collection instruments in case there is delay in giving credit
beyond the time period mentioned above. Such interest shall be paid without any demand from customers in all types of accounts. There shall be no distinction between
instruments drawn on the banks own branches or another banks for the purpose of payment of interest on delayed collection.
Interest for delayed collection shall be paid at the following rates:

Savings Bank rate for the period of delay beyond 7/10/14 days as the case may be in collection of outstation cheques.

Where the delay is beyond 14 days interest will be paid at the rate applicable to for term deposit for respective period.

In the case of extraordinary delay i.e. delays exceeding 90 days, interest will be paid at the rate of 2% above the corresponding Term deposit rate.

In the event the proceeds of cheque under collection was to be credited to an overdraft/loan amount of the customer, interest will be paid at the rate applicable to loan
account. For extraordinary delays, interest will be paid at the rate of 2% above the rate applicable to the loan account.

It may be noted that interest payment as given above would be applicable only for instruments sent for collection within India .
Note:

1.

Interest payment as above would be applicable only for instruments sent for collection within India.

2.

The payment of interest for the delay in collection of outstation instruments are not applicable to non-negotiable instruments viz. Prize winning lottery tickets and
proceeds of matured Deposit receipts of other banks, etc.

5. Cheques/Instruments lost in transit/in clearing process or at paying banks' branch:

In the event a cheque or an instrument accepted for collection is lost in transit or in the clearing process or at the paying bank's branch, the bank shall immediately on coming to
know of the loss, bring the same to the notice of the account holder so that the account holder can inform the drawer to record stop payment and also take care that cheques, if
any, issued by him / her are not dishonoured due to non-credit of the amount of the lost cheques / instruments. The bank would provide all assistance to the customers to obtain a
duplicate instrument from the drawer of the cheque. In line with the compensation policy of the Bank, the Bank will compensate the account holder in respect of instruments lost in
transit in the following way;

i.

In case intimation regarding loss of instruments is conveyed to the customer beyond the time limit stipulated for collection (7/10/14 days as the case may be) interest
will be paid for the period exceeding the stipulated collection period at the rates specified above.

ii.

In addition, bank will pay interest on the amount of the cheque for a further period of 15 days at Savings Bank rate to provide for likely further delay in obtaining
duplicate cheque / instrument and collection thereof.

iii.

The bank would also compensate the customer for any reasonable charges he / she incurs in getting duplicate cheque / instruments upon production of receipt in the
event the instrument is to be obtained from a bank / institution who would charge fee for issue of duplicate instrument and also reasonable charges incurred for
stopping payment of the cheque.

5.1 : Receiving payment based on an electronic image of a truncated cheque:

i.

a. Cheque truncation system- Sec 131 of Negotiable Instrument Act 1881(amendments)

ii.

b. Onus of due diligence shifted to the presenting bank in CTS environment

Cheque truncation is the process of eliminating the flow of physical cheque issued by a drawer to the Drawee branch. The physical cheque will be truncated and electronic image
of the cheque are captured for processing. The physical cheques are retained at the presenting bank itself. The captured image along with data are exchanged across the banks.
Legal status of the cheque truncation is derived from amendments made to the Negotiable Instrument Act, 1881 by virtue of Negotiable Instruments (Ammendments and
Miscellaneous Provision) Act,2002 where by among others the section 6,64,81,89 and 131 of the NI Act,1881 are also suitably amended to incorporate the validity of the truncated
image of the cheque. We invite the attention to the amendment to section 131 where in the existing explanation is renumbered as explanation 1 and the following explanation is
inserted
Explanation II-It shall be the duty of the banker who receives payment based on an electronic image of a truncated cheque held with him, to verify the prima facie genuineness of
the cheque to be truncated and any fraud, forgery or tampering apparent on the face of the instrument that can be verified with due diligence and ordinary care.
In view of the above amendment, the presenting bank takes responsibility for exercise of due diligence. The branches while sending cheques to CTS scaning centre should
ensure the following

To exercise due diligence on all instruments

To cheque the apparent tenor of the instruments

To ensure verification under Ultra Violet Lamp (UVL)

To scrutinize the cheques for material alteration

To ensure genuineness and validity of instruments

To ensure that pay in slip is properly filled up with 13 digit correct account number and name

The scanning centre while scanning the instruments should inter alia also ensure the following

To check the apparent tenor and genuineness of the instruments

To ensure verification of instruments under UV Lamp

To ensure instrument confirms to features of CTS 2010 standard

To ensure physical feel of the instrument meets the usual paper standard used for cheque

To ensure no material alteration visible to naked eye

6. Force Majeure :
The bank shall not be liable to compensate customers for delayed credit due to some unforeseen event (including but limited to civil commotion, sabotage, lockout, strike and

other labour disturbances, accidents, fires, natural disasters or other "Acts of God", war, damage to the banks' facilities or of its correspondent Banks) absence of the usual means
of communication or all types of transportation, etc beyond the control of the Bank prevents it from performing its obligation within the specified service delivery parameters.
7. Charging of Interest on cheques returned unpaid where Instant Credit was given:
If a cheque sent for collection for which immediate credit was provided by the Bank is returned unpaid, the value of the cheque will be immediately debited to the account. The
customer will not be charged any interest from the date immediate credit was given to the date of return of the instrument unless the bank had remained out of funds on account
of withdrawal of funds. Interest where applicable would be charged on the notional overdrawn balances in the account had credit not been given initially.
If the proceeds of the cheque were credited to the Savings Bank Account and were not withdrawn, the amount so credited will not qualify for payment of interest when the cheque
is returned unpaid. If proceeds were credited to an overdraft/loan account, interest shall be recovered at the rate of 2% above the interest rate applicable to the overdraft/loan
from the date of credit to the date of reversal of the entry if the cheque/instrument was returned unpaid to the extent the bank was out of funds.
8. Cheque payable in foreign countries :
Cheques payable at foreign centers where the bank has branch operations will be collected through that office. The services of correspondent banks will be utilized in
country/centers where the correspondent has presence. Cheques drawn on foreign banks at centers where the bank or its correspondents do not have direct presence will be
sent direct to the drawee bank with instructions to credit proceeds to the respective Nostro Account of the bank maintained with one of the correspondent banks.
8.1 Collection of USD Denominated Clean Instruments :
Introduction:
Clean instruments denominated in currencies other than Indian Rupees such as Euro, Pound Sterling, US Dollar, Yen, etc., are called foreign currency cheques/clean instruments.
Since such instruments are not payable in India they are, therefore, required to be sent to the country concerned for realization of proceeds. The time norms for collection and
return of the instruments vary from country to country and place to place within a country.
Clean instruments / Cheques payable at foreign centers where our bank has branch operations (or banking operations through a subsidiary, etc.) will be collected generally
through that office/branch. The services of correspondent banks will be utilized in country/centers where the correspondent has a presence. Cheques drawn on foreign banks at
centers where the bank or its correspondents do not have direct presence will be sent direct to the drawee bank with instructions to credit proceeds to the Nostro Account of the
bank maintained with one of the correspondent banks.
The clean instruments denominated in USD and payable in USA are generally known as USD denominated cheques/instruments.
i) Type of Instruments :
Clean instruments like personal cheques, Travelers cheques, Demand Drafts, Cashier orders, Pay Orders, Bankers' cheques, International Money Orders or any other such
instruments, payable abroad may be submitted for collecting the proceeds of the instrument.
ii) Risk perceived in collection of USD Denominated Instruments :
As per US Laws materially altered cheques, where the beneficiary's name has been changed and/or the amount of the cheques raised, the drawee bank is obliged to reimburse
the drawer within 12 months for wrongfully paying the cheque.
In such cases the Correspondent Bank mandatorily claim the amount from us and debit Nostro account. Hence, the proceeds of the clean instruments credited to customer's
account are subject to right to debit in case of return of instruments.
iii) Products offered by us for USD denominated instruments :
a. Secured Collections Service :

Under this facility the risks mentioned above can be mitigated.

Under this facility, our correspondent bank provides guaranteed final credit without recourse within a confirmed time period.

For such facility our correspondent bank, charges additional service charges for giving credit without recourse.

Time period for collection of the proceeds are as under:

If the cheque/instrument is drawn on bank located in
New York
If the cheque/instrument is drawn on bank located
b
outside New York
a

Six business days after receipt of cheque/instrument at Correspondent bank's

processing center at New York
Fifteen business days after receipt of cheque/instrument at Correspondent bank's
processing center at New York

Correspondent bank
charges
Correspondent bank
charges

Amount of the cheque should not exceed USD300, 000.

Traveler Cheques/Treasury cheques/postal money order is not covered under this facility.

All the clean instruments/cheques lodged by customers for amounts USD 5000 and above, have to be necessarily collected under this facility.

It takes approximately between 10 to 18 days for affording the credit to the customer's account.

b. Cash Letter Service :

It is recommended that all the clean instruments drawn in USD & payable in USA be collected under 'Secured Collections Service', to enable the customers to get a
final credit instead of a conditional credit.

For USD denominated clean instruments for amounts up to USD 5000, the customers have the option of collecting the proceeds under Cash Letter Service.

As per this facility our correspondent gives credit to our Nostro account on sending the cheques in clearing system. However, the conditional credit is given to the
customer's account only after the expiry of the cooling period.

Approximate time period for collecting the proceeds of the cheque

a If the instrument/cheque is drawn on bank located in New York

b

If the instrument/ cheque is drawn on bank located outside New

York

Six business days from the value date for the instrument/cheques payable at New York
10 business days from the value date for instrument/cheques payable outside New York but within
USA

It approximately takes around 15 days for affording the credit to the customer's account.

c. Instant Credit :

Subject to the satisfactory track record of the customer etc, the credit may be given to the customer's account, with out completion of the cooling period, on citing the
pass sheet credit for clean instruments denominated in USD up to USD 5000, sent under the facility of Cash Letter Service.

IV) Compensation :

Customers would be compensated for delay in crediting the proceeds of foreign currency instruments payable abroad / in India and sent on collection basis.

Such compensation would be paid at the rate of interest applicable to NRE SB accounts in respect of NRI-clients and domestic SB account in the case of residentcustomers, for the delays beyond prescribed period for various transactions which are as under:

a.

Personal cheques/drafts payable in the country of currency if proceeds are not credited within 21 days.

b.

Personal cheques / drafts payable in the country other than in the currency of the country If proceeds are not credited within 45 days

8.2 POLICY ON COLLECTION OF CHEQUES DENOMINATED IN FOREIGN CURRENCY OTHERN THAN USD
1. Collection of instruments drawn in Home Currencies of the Drawee Centre (other than US Dollar):
The instruments payable at the country of its currency i.e. like GBP instruments payable in UK is sent to the Nostro Correspondent Bank at the drawee centre for collection of the
same. As per this arrangement, the amount of the instrument is credited to our Nostro account immediately upon its presentation for payment to drawee bank by the
Correspondent Bank, through clearing or collection. Though amount is credited to our Nostro account, immediately the same is only on conditional basis and not a final credit.
Such instruments are treated as realized, only upon completion of the prescribed waiting period, as the paying bank has a time limit for returning the instrument for reasons like
insufficiency of funds in the drawer's account, forged instruments, etc.
2. If the instruments are returned for any reason, the Correspondent Bank will debit the account with back value [i.e., the same value date as the original pass sheet
credit] and additional charges for returning the instrument unpaid. In order to safeguard, the waiting period concept is followed. Accordingly the instrument is treated
as realized only after expiry of waiting period after the date of pass sheet credit entry and adjust the realization after this waiting period. This waiting period varies
from country to country and where the instrument is payable which is as under:
Waiting Period:
GBP instruments payable in UK

10 business days from the value date

EURO instruments payable in Germany/Italy/ France/Netherlands

21 business days from the value date

Instruments in all other currencies payable at the Centres whose home currency is the currency of the instrument.

22 days from the value date

3. Handling Instruments Drawn on EURO Land:

a.

Cheques denominated in EURO currency and payable in Germany, Italy, Netherlands and France will be handled under Cash Letter Service.

b.

Each instrument including TCs, irrespective of its denomination, will be levied charges of EURO 1.00 per instrument for handling under Cash Letter Service.

c.

EURO cheques drawn on other countries will be handled only under 'under collection' basis.

d.

Cheques sent under collection normally take around 30 to 45 days for realization and charges are likely to be around EURO 50 per instrument.

e.

Unlike USD Cash Letter Service System, the Banks in Euro Land do not undertake 'no return- guaranteed payment' after a specified period. Hence cheques beyond
EURO 5000 are not handled under 'Cash Letter Service' and the same are handled only under collection basis.

f.

Endorsement by payee on the back of the cheque in the space provided is one of the conditions for collection of Euro cheques.

4. Instant Credit:
Subject to the satisfactory track record of the customer etc, immediate credit may be given to the customer's account, without completion of the cooling period, on citing the pass
sheet credit for clean instruments denominated in GBP and EURO up to the equivalent of USD 10000.
Service Charges:
For all collection services the Bank will recover appropriate Service Charges as decided by the Bank from time to time and communicated to customer as displayed in the notice
board of branches and indicated in the BCSBI codes (item no. 3.4 tariff schedule) and adopted by the bank.

Illustrative list of objections where customers are not at fault

Code No

Reason for Return

33

Instrument mutilated; requires banks guarantee

35

Clearing House stamp / date required

36

Wrongly delivered / not drawn on us

37

Present in proper zone

38

Instrument contains extraneous matter

39

Image not clear; present again with paper

40

Present with document

41

Item listed twice

42

Paper not received

60

Crossed to two banks

61

Crossing stamp not cancelled

62

Clearing stamp not cancelled

63

Instrument specially crossed to another bank

67

Payees endorsement irregular / requires collecting banks confirmation

68

Endorsement by mark / thumb impression requires attestation by Magistrate with seal

70

Advice not received

71

Amount / name differs on advice

72

Drawee banks fund with sponsor bank insufficient (applicable to sub-members)

73

Payees separate discharge to bank required

74

Not payable till 1st proximo

75

Pay order requires counter signature

76

Required information not legible / correct

80

Banks certificate ambiguous / incomplete / required

81

Draft lost by issuing office; confirmation required from issuing office

82

Bank / branch blocked

83

Digital certificate validation failure

84

Other reasons connectivity failure

87

Payees account credited Stamp required

92

Bank excluded

9. COLLECTION OF ACCOUNT PAYEE CHEQUE:

It is prohibited from crediting account payee cheques to the account of any person other than the payee named in the negotiable instruments. However, since cooperative
societies are not even sub-members of clearing houses, the account holders of such cooperative societies who have no bank accounts finds difficulty in collection of account
payee cheques drawn in their name. In order to mitigate the difficulties faced by account holders of cooperative societies in collection of account payee instruments, bank shall
collect account payee cheque for an amount not exceeding ` 50000/- to the account of cooperative societies account holders, if the payees of such cheques are the constituent of
such co-operative societies. For this purpose the co-operative societies should give a clear representation in writing that, upon realisation of the proceeds of the cheque it will be
credited only to the account of the member of co-operative societies who is the payee named in the instruments. The bank shall carry out proper due diligence with respect to
such co-operative credit societies and ensure that KYC documents of the customers are preserved in the societys records and are available to the bank for scrutiny.
In the event of any claim by the true owner of the instrument, the right of the true owner of the instruments are not in any manner affected and bank shall establish that such
action is done in good faith and without negligence while collecting the cheque in question.