New Delhi: The National Consumer Disputes Redressal Commission has issued notice to the Reserve Bank of India and 88 commercial banks, including foreign banks operating here, for delaying the crediting of cheques.

It was taking action on a complaint that the banks in the country are allegedly earning nearly Rs. 621 crore in interest every day due to delays in crediting cheques sent for clearance.

Taking serious note of the complaint of alleged deficiency in service and violation of the RBI guidelines by both public and private sector banks, the commission sought their reply. It asked the RBI to place on record the guidelines on such transactions.

The commission, comprising chairman Justice M.B. Shah and member P.D. Shenoy took cognisance of the complaint filed by former Punjab Additional Advocate General Atul Nada and lawyer Rameeza Hakeem.

Consumers' rights violated

According to the complainants, a gross violation of the rights of millions of consumers was taking place in the banking industry. They pointed out that there was a huge time gap between the time when the cheque of a bank's customer was paid by the drawee bank, till the time the bank actually credited its customer's account and a still further time gap when funds were made available for withdrawal.

The complainants said: "During all these delays, these funds are available to the bank and the bank uses this `funding float' without any payment of interest to the consumer. This is in violation of the spirit and the guidelines of the RBI and in violation of the rights and interests of the consumers."

They said that in a financial year nearly 13,000 lakh cheques were cleared by the 88 banks operating in India through their branches across the country attributing to a total amount of more than Rs. 1,13,37,000 crore. Even if it was assumed that the banks enjoyed the benefit of `fund float' only on 50 per cent of the cheques deposited, the daily rate of interest would come to about Rs. 621 crore a day at four per cent rate of interest.

They submitted that as per the RBI guidelines a local cheque was to be credited on the third working day from the date of acceptance of cheques at the counters; to give credit within seven days for an outstation cheque drawn on a bank in any of the four metropolitan cities and this procedure was not being followed.

They contended that such a delay was not permissible under the RBI guidelines as well as the Banker's Code framed by the Banking Code and Standards Board of India from time to time. They said that the banks were not formulating a proper cheque clearance policy and as a result consumers were denied the benefit of withdrawing their money on time.

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