FASCIA SIGN WITHOUT BRANCH NAME बैंक ऑफ बड़ौदा Bank of Baroda

POLICY

ON

COLLECTION

OF

CHEQUES / INSTRUMENTS

Approved by the Board Agenda Item No. O-3 Dated 22.12.2017

Operations & Services

Head Office
Baroda

परिचालन व सेवाएँ ववभाग, प्रधान कार्ाालर्, बड़ौदा, Operations & Services Department, Head Office, Baroda
आठव ीं मींजिल, सूरि प्लाज़ा-1 ,सयाि गींि, बड़ौदा -390 005, 8th Floor, Suraj Plaza-1, Sayajigunj, Baroda-390 005
फोन /Phone: 0265- 2307801 ई-मेल/E-mail: operations.ho@bankofbaroda.com
 FASCIA SIGN WITHOUT BRANCH NAME बैंक ऑफ बड़ौदा Bank of Baroda
Policy on Collection of Cheques / Instruments
1. Preamble

Policy on Collection of Cheques and Instruments was prepared in 2005 based

on Model Policy given by IBA and renewed annually as per the guidelines
issued by RBI/IBA/BCSBI from time to time. This collection policy of our Bank
is a reflection of our on-going efforts to provide better service to our customers
and set higher standards for performance.

2. Purpose / Objective

The main objective of the policy is to provide framework for collection of cheque
and other instruments for Bank’s customers taking into account our
technological capabilities, systems and processes for adherence to such norms
and compensation to customer in case of delay in collection of
cheques/Instruments.

The policy is based on principles of transparency and fairness in the treatment

of customers. The bank is committed to increase use of technology to provide
quick collection services to its customers.

3. Scope / Coverage
This policy document covers the following aspects:

 Arrangements for Collection of domestic cheques and other instruments

payable locally including coverage Under CTS clearing at centers within
India.
 Procedure for collection of cheques payable outside India, time period,
interest on delayed collection etc.
 Immediate credit of cheques payable in India and in foreign countries
 Commitment regarding time norms for collection of instruments.
 Policy on payment of interest in cases where the bank fails to meet standard
time norms for realization of proceeds of outstation instruments.
 Policy on dealing with collection instruments lost in transit/in clearing
process or at paying bank’s branch
 Reasons for return.

Guidelines/ detailed procedure for collection of Domestic cheques/instruments

and cheques payable in Foreign Countries covering time frame for collection,
immediate credit, interest payment for delayed collection etc., are given in
Annexure -1 and Annexure-2 respectively.

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 FASCIA SIGN WITHOUT BRANCH NAME बैंक ऑफ बड़ौदा Bank of Baroda
Procedure for collection of cheques payable locally and outstation
including CTS clearing which covers details as under. (Annexure-1)
1. Local cheques at MICR/NON-MICR centres
1.1 Local cheques through CTS clearing
2. Outstation Cheques
2.1 Drawn on our Bank’s own branches
2.2 Outstation cheques drawn on other bank’s network
2.3 Through speed clearing
3. Immediate Credit of Local / Outstation Cheques / Instruments
3.1 Interest on cheques returned unpaid under Immediate Credit
4. Purchase of Local / Outstation Cheques
5. Time frame for collection of local / outstation cheques / instruments
6. Payment of interest for delayed collection
6.1 Local Cheques
6.2 Outstation Cheques sent for collection within India
7. Service Charges
8. Cheque return on account of technical reason along with list of reasons.
9. Collection of third party cheque
10. Collection of cheques in the name of Deceased person
11. Validity of Cheques / Drafts / Banker’s cheques etc,
12. Cheques / Instruments lost in transit / in clearing process or at paying
branch.
Procedure for collection of cheques payable in Foreign countries
(Annexure-2)
1. Cheques payable in Foreign Countries
2. Immediate Credit of Foreign Currency Cheques
3. Service Charges
4. Payment of interest for delayed collection

4. Force Majeure
The bank shall not be liable to compensate customers for delayed credit if some
unforeseen event (including but not limited to civil commotion, sabotage,
lockout, strike or other labour disturbances, accident, fires, natural disasters or
other “Acts of God”, war, damage to the bank’s facilities or of its correspondent
bank(s), absence of the usual means of communication or all types of
transportation, etc.) beyond the control of the bank, prevents it from performing
its obligations within the specified service delivery parameters.

5. Periodicity of Review of the Policy

The policy will be effective upto 31.07.2019. The MD & CEO may allow
continuation of the policy for a maximum period of six months from due
date of review, in case the policy cannot be reviewed on or before due
date.

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 FASCIA SIGN WITHOUT BRANCH NAME बैंक ऑफ बड़ौदा Bank of Baroda
Annexure - I

Arrangements for Collection:

Customer can deposit cheques for collection/clearing during the business hours at
counter at branch or through Drop Box (where ever available).

1. Local Cheques at MICR / Non-MICR Centres

All cheques and other Negotiable Instruments payable locally would be presented
through the clearing system i.e. MICR/Non-MICR prevailing at the centre.
Cheques deposited at branch counters and in cheque drop boxes before the
specified cut-off time will be presented for clearing during immediate cycle of
clearing. Cheques deposited after the cut-off time in cheque drop boxes within and
outside the branch premises including off-site ATMs will be presented in the next
clearing cycle. As a policy, bank would give credit to the customer account on the
day clearing settlement takes place. Withdrawal of amounts so credited would be
permitted as per the cheque return schedule of the clearing house at the centre.

The branches will display the cut-off time for receipt of cheques to be sent in
clearing during the next clearing cycle. The cut-off time for collection of cheque
from drop boxes installed at off-site ATM will be displayed on the face of the drop
boxes.

The Bank branches, situated at centers where there are no arrangements of

clearing house, would present local cheques on drawee banks across the counter
and it would be the bank’s endeavor to credit the proceeds at the earliest.

Local cheques drawn on our branches will be credited in the customer’s account
on the same day subject to confirming the guidelines on Inter-SOL transactions.

1.1 Local cheques through CTS Clearing :

RBI has introduced CTS clearing at Northern Grid in New Delhi, Western Grid
in Mumbai, Southern Grid in Chennai covering major parts of the country.

Wherever CTS clearing has been implemented cheques will be credited as

per clearing settlement of CTS Clearing cycle.

For Non-CTS instruments / cheques, guidelines of RBI are there, for clearing
of Non-CTS instruments on lesser frequency.

There are no charges for collection of local cheques.

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 FASCIA SIGN WITHOUT BRANCH NAME बैंक ऑफ बड़ौदा Bank of Baroda
2. Outstation Cheques :

2.1 Cheques drawn on our Bank’s own branches

Cheques drawn on bank’s own outstation branches are treated as Inter-sol
transfer transactions and credited as per guidelines for inter-sol transfer
transactions. As all branches of the Bank are on CBS platform, same day
credit will be provided to its customers in respect of outstation instruments
drawn on any of its branches and received during business hours.

2.2 Outstation cheques drawn on other bank’s network :

Cheques drawn on other banks at outstation centers will normally be collected
through CTS clearing. The bank would also use the National Clearing
services offered by the Reserve Bank of India at centers where such collection
services exist.

2.3 Collection of outstation cheques through Speed Clearing:

Speed clearing refers to collection of Outstation cheques drawn on other
bank’s branches which are under Core Banking (CBS) environment/ platform
locally.
The branches which are not covered under CTS clearing will collect outstation
cheques drawn on other banks which are on CBS platform but not covered
under CTS clearing through Speed Clearing. Speed clearing is implemented
at MICR and Non-MICR centers under Express cheque clearing system of
RBI.

3. Immediate Credit of Local / Outstation Cheques / Instruments:

Bank will consider providing immediate credit for outstation cheques / instruments
up to the aggregate value of Rs.20,000/- tendered for collection by individual
account holders subject to satisfactory conduct of KYC Compliant accounts for
a period not less than 6 months. Immediate credit will be provided against
collection of instruments at the specific request of the customer or as per prior
arrangement. The facility of immediate credit would also be made available in
respect of local cheques at centres where no formal clearing house exists.

The facility of immediate credit will be offered on Savings Bank / Current / OD/
Cash Credit Accounts of the customers. For extending this facility there will not
be any separate stipulation of minimum balance requirement in the account.

Under this policy, instruments like Demand Draft / Bankers Cheque, Interest /
Dividend warrant etc., shall be treated at par with cheques.

For the purpose of this Policy, a satisfactorily conducted account shall be the
one

a) Opened at least six months earlier.

b) Bank has not noticed any irregular dealings.

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 FASCIA SIGN WITHOUT BRANCH NAME बैंक ऑफ बड़ौदा Bank of Baroda
c) Where no cheques / instruments for which immediate credit was afforded
returned unpaid for financial reasons
d) Where the bank has not experienced any difficulty in recovery of any amount
advanced in the past including cheques returned after giving immediate credit.
e) The account is complied with KYC AML Policy of the Bank on the date of credit
provided

The Bank shall levy normal collection charges and out of pocket expenses while
providing immediate credit against outstation instruments tendered for collection.
Exchange charges applicable for cheque purchase will not, however be charged.

The facility of immediate credit would not be applicable to cheques collected under
Speed clearing arrangements.

The Branches will display the scheme of immediate credit of outstation cheques
on their notice board for knowledge of the customers. This will also be displayed
on Bank’s web-site.

However, wherever product specific limits are specified for immediate credit of
outstation cheques are provided, the same will be extended to the customers or
Rs.20000/- whichever is higher.

3.1 Interest on cheques returned unpaid under Immediate Credit :

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
wherever 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 were returned unpaid to the
extent the bank was out of funds.

4. Purchase of local / outstation cheques

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

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 FASCIA SIGN WITHOUT BRANCH NAME बैंक ऑफ बड़ौदा Bank of Baroda
4.1 Immediate credit of Banker’s Cheque, Drafts etc. during suspension of
clearing
In case of temporary suspension of Clearing House operations for reasons
beyond the control of authorities /bank, and it is apprehended that
suspension may prolong, in order to entail hardship of the constituents, bank
may try to accommodate both borrowers and depositors to the extent
possible by purchasing Banker’s cheques, demand draft etc and cheques
deposited in their account drawn by Government Departments and Demand
Draft drawn on local banks. This facility Will be extended on the basis of
creditworthiness, integrity, past dealings and occupation of the constituents
to safe guard the interest of the bank against possibility of such instruments
being dishonoured subsequently.

5. Time Frame for Collection of Local / Outstation Cheques / Instruments:

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 return clearing norms in vogue.
5.1 For cheques and other instruments drawn on Banks which are not on
CBS Platform the collection period will be as under.
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. Cheques drawn on Metro Centers and State Capitals (other than those of
North Eastern States and Sikkim): Maximum period of 10 days.
c. Cheques drawn on all other Centers : Maximum period of 14 days
5.2 Cheques drawn on Banks which are on CBS platform and member of local
clearing house will be collected in next day clearing cycle/day.

6. Payment of Interest for delayed Collection:

6.1 Local Cheques:
As per the Compensation policy of bank, Bank will pay interest to its
customer on the amount of collection of local cheques at the Savings bank
interest rate in case there is delay in giving credit beyond the time frame
given for collection of local cheques given at Para -5.
Interest will be paid for the period of delay excluding normal collection
period.
6.2 Outstation Cheques sent for Collection within India
As part of the compensation policy of the bank, the Bank will pay interest to
its customer on the amount of 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 bank’s own

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 FASCIA SIGN WITHOUT BRANCH NAME बैंक ऑफ बड़ौदा Bank of Baroda
branches or on other banks for the purpose of payment of interest on
delayed collection.
Interest for delayed collection shall be paid at the following rates:
a. Savings Bank rate for the period of delay beyond 7/10 days (upto 14
days) as the case may be in collection of outstation cheques payable
at major metro centers and state capitals.
b. Where the delay is beyond 14 days but up to 90 days interest will be
paid at the rate applicable to term deposit for the respective period for
collection of outstation cheques payable at all centres.
c. In case of extraordinary delay, i.e. delays exceeding 90 days interest
will be paid at the rate of 2% above the corresponding Term Deposit
ratefor collection of cheques payable at all centres.
d. In the event the proceeds of cheque under collection are to be credited
to an overdraft/loan account of the customer, interest will be paid at the
rate applicable to the 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.
7. 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 by
displaying the same on Bank’s website.

8. Cheque return on account of technical reason along with list of reasons and
Representation of returned cheque
Cheques returned on account of technical reason will be represented (wherever
required and possible) in the immediate next presentation clearing not later than
24 hours (excluding holidays).

Cheque will be returned if any alteration is made in cheque. No changes /

corrections should be carried out on the cheques in the payee’s name, courtesy
amount (amount in figures) or legal amount (amount in words) etc. excepting
change in the date for validation period, fresh cheque forms should be used by
customers. It is also applicable for the instruments presented in clearing at CTS-
2010 grid based clearing centres. Collecting banks have to ensure that such
cheques are not accepted for presentation in CTS. It is not applicable to cheques
cleared under other clearing arrangements such as MICR clearing, Non-MICR
clearing, over the counter collection (for cash payment) or direct collection of
cheques outside the Clearing House Arrangement.

Cheque return charges shall be levied only in cases where the customer is at fault
and is responsible for such returns. List of reason for returns where the customers
are not at fault are indicated in Annexure –I.a.

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 FASCIA SIGN WITHOUT BRANCH NAME बैंक ऑफ बड़ौदा Bank of Baroda
9. Collection of third party cheque:
Bank will not collect account payee cheques for any person other than the payee
constituent. However, under following circumstances bank will collect account
payee cheques for third parties.
a. Where the drawer / payee instructs the bank to credit the proceeds of
collection to any account other than that of the payee, the instruction being
contrary to the intended inherent character of the 'account payee' cheque,
bank will ask the drawer / payee to have the cheque or the account payee
mandate thereon withdrawn by the drawer. This instruction would also apply
with respect to the cheque drawn by a bank payable to another bank.

b. In order to facilitate collection of cheques from a payment system angle,

account payee cheques deposited with the sub-member for credit to their
customers' account can be collected by the member bank (referred to as the
sponsor member) of the Clearing House. Under such arrangements, there
should be clear undertaking to the effect that the proceeds of the account
payee cheque will be credited to the payee's account only, upon realization.

c. With a view to mitigate the difficulties faced by the members of co-operative

credit societies in collection of account payee cheques, bank may consider
collecting account payee cheques drawn for an amount not exceeding Rs.
50,000/- to the account of their customers and the payees of such cheques
are the constituents of such co-operative credit societies. While collecting the
cheques as aforesaid, bank will obtain a clear representation in writing from
the co-operative credit societies concerned that, upon realization, the
proceeds of the cheques will be credited only to the account of the member of
the co-operative credit society who is the payee named in the cheque. This
shall, however, be subject to the fulfillment of the requirements of the
provisions of Negotiable Instruments Act, 1881, including Section 131 thereof.

This is applicable to Drafts, Pay Orders and Banker’s Cheque also.

10. Collection of cheques in the name of Deceased Person :

For collection of cheque in the name of deceased person, bank will obtain
authorization from the Survivor(s)/nominee of a deceased account holder to open
an account styled as “Estate of Shri___________ Deceased”. Where all pipeline
flows in the name of deceased account holder could be allowed to be credited,
provided no withdrawals are made.
Or
The Bank would be authorized by the survivor(s) / nominee to return the pipeline
flows to the remitter with the remark “Account holder deceased” and will intimate
the survivor(s) / nominee accordingly. The survivor(s) / nominee / legal heir(s)
could then approach the remitter to effect payment through a negotiable
instrument or through ECS transfer in the name of the appropriate beneficiary.

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 FASCIA SIGN WITHOUT BRANCH NAME बैंक ऑफ बड़ौदा Bank of Baroda
11. Validity of Cheques / Drafts / Pay orders / Banker’s Cheques :

With effect from April 1, 2012, the validity of Cheques / Drafts / Banker’s Cheques
is three months only from the date of issue. The validity period is mentioned on
the face of Cheque leaves, Drafts / Banker’s Cheques printed after 01.04.2012.
Instruments should be presented within the validity period of three months from
the date of issue.

12. Cheques / Instruments lost in transit / in clearing process or at paying bank’s

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
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 customer to
obtain a duplicate instrument from the drawer of the cheque.

The onus of such loss lies with the collecting banker and not the account holder.

If the cheque / instrument have been lost at the paying bank's branch, the
collecting banker will have a right to recover the amount reimbursed to the
customer for the loss of the cheque / instrument from the paying banker.

In line with the compensation policy of the bank the bank will compensate the
accountholder in respect of instruments lost in transit in the following way:

a. In case intimation regarding loss of instrument 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 under point No.4.

b. 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.

c. The bank would also compensate the customer for any reasonable charges
he/she incurs in getting duplicate cheque/instrument upon production of
receipt, in the event the instrument is to be obtained from a bank/ institution
who would charge a fee for issue of duplicate instrument. The charges
incurred for making stop payment of the lost cheque by the customer with the
Paying Bank will be compensated by the Bank.

d. In the cases where cheque is lost after it has been discounted, Bank will not
recover the interest for a period of 15 days when it comes to know about the
loss of the instrument. This will give ample time to the borrower to obtain
duplicate instrument from the drawer. In case borrowers fail to liquidate the
account after lapse of 15 days, the interest at contractual rate will be recovered
from them till the amount advanced is fully paid.

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 FASCIA SIGN WITHOUT BRANCH NAME बैंक ऑफ बड़ौदा Bank of Baroda
Annexure: I.a

Illustrative but not exhaustive list of objections / reasons where customers are
not at fault.

(Applicable for Instrument and Image-based Cheque Clearing as detailed in

Annexure D to Uniform Regulations and Rules for Bankers' Clearing Houses)

Code No Reasons for Return

33 Instrument mutilated; requires bank's 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 Payee’s endorsement irregular / requires collecting bank's 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 bank's fund with sponsor bank insufficient(applicable to sub-
members)
73 Payee's separate discharge to bank required
74 Not payable till 1stproximo
75 Pay order requires counter signature
76 Required information not legible / correct
80 Bank's 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 ‘Payee's a/c Credited' - Stamp required
92 Bank excluded

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 FASCIA SIGN WITHOUT BRANCH NAME बैंक ऑफ बड़ौदा Bank of Baroda
Annexure - II

1. Cheques payable in Foreign Countries

Cheques payable at foreign centers where the bank has branch operations (or
banking operations through subsidiary, etc) 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 drawee bank with instructions to credit proceeds to the respective
Nostro Account of the bank maintained with one of the correspondent banks.

The maximum period for affording credit will be 25 working days or 1 calendar
month whichever is higher (subject to holidays in those countries).

The above time norms are applicable irrespective of whether cheques/

instruments are drawn on the bank’s own branches or branches of other banks.

The dishonored instruments will be returned/dispatched to customers as per

policy on “Dishonour of Cheques”.
[[

Collection of foreign currency denominated cheques payable outside

India [[

For collection of USD cheques/instruments drawn on USA, Authorized

Dealers (AD branches) to forward the same to NRI Branch, Mumbai
identified as Nodal Branch/single point collection centre to collect
cheques and instruments. Nodal Branch (NRI branch, Mumbai) will pool
the instruments received from all branches in India and shall forward to
Bank of Baroda New York.

Cheques /Drafts deposited for the purpose of opening of FCNR account

should be sent by AD branches directly to BOB New York for credit of
specific designated Nostro account for FCNR deposit.

Authorized branches presently having cheque collection arrangements

with Wells Fargo Bank may continue to use their services in addition to
the cheques collection arrangement with BOB New York as mentioned
above.

For cheques drawn in currencies like EUR/GBP tendered for collection at our
branches, cheques drawn in Euro is sent for collection to our Brussels branch
and those drawn in GBP to our London main branch. Major transactions in
these currencies are done through wire transfers.

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As such no separate Correspondent Banking arrangement for collection of Euro
/GBP denominated cheques is envisaged.

The Bank will endeavour to provide the credit to its Customers at the earliest.
Foreign currency cheques received at non authorized branches are sent to
authorized branch for collection. Authorized branch sends it to respective
correspondent bank on the same day through Bank’s approved reliable courier
service. The time norms for collection and return of the instruments varies from
country to country and place to place within the country where a ‘cooling period’
is prescribed, which are as under:-

 on New York, USA is 6 working days

 on other centers in the USA is 15 working days
 on London, UK is 5 working days
 on other centers in the UK is 15 working days
 on Brussels one month

The effect of credit in customer’s account will be given from the date of credit
in Nostro account. In exceptional cases, where there is delay in giving credit,
interest is paid at the applicable rate for the delayed period.

2. Immediate Credit of Foreign Currency cheques

The Bank may consider providing upfront credit by purchasing the customer’s
personal cheques/ instruments, demand drafts, international money orders,
bankers pay orders payable abroad. If the conduct of the account has been
satisfactory in the past, for a charge at its sole discretion i.e. applicable buying
rate plus interest for a transit period of 15 days at domestic commercial rate of
interest (Base Rate+3%). Alternatively, the customer may utilize the Final
Credit Service, provided by certain correspondents of our Bank on payment of
a fee, which gives return free credit subject to certain conditions.

Cheques/instruments drawn on other banks /our branches located outside

India will be collected at the risk & responsibility of the customers for which a
Letter of Indemnity (as per Annexure-II.a) will be taken from the customer by
the branches.

3. Service Charges:

There is a separate schedule of charges for collection of foreign currency

cheques which is as under:-

Clean instrument for collection:-

Commission will be recovered on collection of instruments sent for collection

abroad at prevailing rate approved by bank from time to time.

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4. Payment of Interest for delayed Collection of Cheques sent for collection
to foreign countries.

The Bank will pay interest to its customers on account of collection of outstation
instruments sent for collection to foreign countries where the credit has not
been given.

Banks would pay interest on amount of cheque from the date of sighting credit
in their nostro account till such time the customer account is credited. Interest
would be paid at the Savings Bank rate calculated on the amount of proceeds
credited to the customer’s account.

Saturday may continue to be treated as working day except for

transactions involving conversion at confirmed exchange rate. In such
cases, preceding day’s exchange rate will apply.

Additional Interest:

Compensation by way of additional interest will be paid to the customer

for delay in collection beyond the declared collection period as per the
bank’s policy, without the customer requesting for the same and such
interest will be on “step-up basis” for the period of delay.

Interest for delayed collections will be payable at the following rates:

2% over the applicable Saving Bank rate of interest for the period of delay

The customer will also be compensated for the loss on account of

adverse movement of exchange rate i.e. loss due to exchange rate
difference, if any, between the actual exchange rate at which foreign
currency is converted into Indian Rupees and the exchange rate as on the
latest due date of payment .

****

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Annexure - II. a

To be stamped as Letter of Indemnity

DRAFT OF INDEMNITY

(For collection of cheques drawn outside India)

Place:
Date:

To

_____________________________

Bank of Baroda
_______________________ Branch

Dear Sir,

In consideration of your undertaking/agreeing to undertake the function of collection

of cheques drawn on other Banks / your branches located outside India (overseas
branches, for short) in my / our favour and deposited in my / our savings / or other
deposit account/s, I / We
_____________________________________________________
hereby agree, undertake and assure to indemnify and keep you indemnified, save you
harmless and safe against/from/and of all actions, losses, costs, consequences,
charges, expenses, claims and demands which BANK OF BARODA may incur or
sustain by reason or on account of the Bank’s such collection of foreign cheque/s or
other instruments for and on my/our behalf, thereby action as my/our Agents, including
those claims etc., occasioned by/arising from/out of return of cheques and other
instruments and/or discrepancies whether technical or financial, if any found,
subsequent to crediting of realization proceeds of cheques and other instruments to
my/our Account (No. ________________/ Nos.
_______________________) and I am/we are allowed to draw/withdraw the same out
of the said account/s such claims against the Bank arising whensoever for whatsoever
reason/s and howsoever and whether or not the said account/s is/are alive operative
at the time when the Bank make a demand on/claim against me/us.

Yours faithfully,

(Name/s of Customer/s)

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