Mumbai : In a big relief to the bank customers, the Reserve Bank of India on Monday has asked the banks to compensate them for delay in clearance of local cheques.

Banks, as per the RBI directive, will have to pay the compensation at savings bank interest rate in absence of a specified rate, for delayed clearance of local cheques.

“In case, no rate is specified in the Cheque Collection Policies (CCP) for delay in realisation of local cheques, compensation at savings bank interest rate shall be paid for the corresponding period of delay,” RBI said on Monday.

It also advised banks to reframe their CCPs specifying details regarding timeline for clearance of local cheques and compensation for delay and display them on their websites.

“Banks are advised to re-frame their CCPs to include compensation payable for the delayed period in the case of collection of local cheques as well,” RBI said.

The central bank has issued the notification in view of difficulties being faced by customers with regard to cheque clearances.

“Instances of delayed credit to customers’ accounts without any compensation for the delayed period beyond the timeline indicated in the CCPs, in respect of local cheques, have been brought to our notice”, the RBI said.

Under the existing norms, the banks can provide facility of withdrawal of some amount against local cheques, subject to safeguards.

RBI, however, clarified there would not be any change in the guidelines regarding realisation and compensation for delay in clearance of outstation cheques.

Banks are required to collect outstation cheques in 14 days and in case of any delay, have to pay interest at the specified rate or equivalent to fixed deposit rate for corresponding maturity.