RBI Bans Fresh PDC/EMI Cheques Where ECS Available
Current · Source: Reserve Bank of India · RBI/2013-14/158 · issued 24 Jul 2013 · ~2 min read
Quick answerRBI reiterates that banks must not accept fresh post-dated or EMI cheques in locations with ECS/RECS (Debit) facility, and must convert existing cheques to ECS mandates. Legal protection under PSS Act 2007 is equivalent to NI Act, so no extra cheques needed.
The rule, in the simplest words
Banks must not accept fresh post-dated or EMI [monthly payment] cheques in areas with Electronic Clearing Service [automatic payment system] (ECS) available
Existing cheques in ECS areas must be converted to ECS [automatic payment system] mandates
No extra cheques are needed beyond ECS mandate due to legal protection under Payment and Settlement Systems Act [law governing payment systems]
How it plays out — a real example
A loan officer in Mumbai, working for a Scheduled Commercial Bank, will stop accepting new post-dated cheques from customers and instead convert existing ones to ECS mandates, streamlining the loan repayment process and reducing costs. This change will help the loan officer manage payments more efficiently and align with the bank's digital payment goals. By following this new rule, the loan officer will also provide better service to customers by reducing the need for physical cheques.
What changed
RBI observed banks still taking fresh cheques (both CTS-2010 and non-CTS) in ECS-enabled locations, violating earlier March 2013 instructions. This circular re-emphasizes the ban on accepting any new PDC/EMI cheques in such areas and mandates conversion of existing ones to ECS mandates. It also clarifies that CTS-2010 cheques are only allowed where ECS is unavailable.
What it means for you
Banks must immediately stop accepting fresh PDC/EMI cheques in ECS-covered locations, reducing cheque processing costs and risks. The legal parity between ECS dishonour and cheque bounce under Section 138 of NI Act gives lenders sufficient recourse, so no need for dual instruments. This streamlines collections and aligns with digital payment goals.
What you must do
Cease acceptance of any fresh PDC or EMI cheques in locations where ECS/RECS (Debit) is available.
Convert existing PDC/EMI cheques in such locations into ECS mandates by obtaining fresh mandates from customers.
Ensure no additional cheques are taken from customers beyond the ECS mandate, leveraging legal protection under PSS Act.
In non-ECS locations, accept only CTS-2010 standard cheques.
Communicate these instructions to all branches and loan processing units immediately.
Who it affects
All Scheduled Commercial Banks including RRBs, Urban Co-operative Banks, State Co-operative Banks, District Central Co-operative Banks, Local Area Banks
❓ Common questions
Can we still accept CTS-2010 cheques in ECS-enabled locations?
No. RBI explicitly prohibits accepting any fresh PDC/EMI cheques, whether in old format or CTS-2010 standard, in locations where ECS/RECS (Debit) facility is available.
What legal protection do we have if we only take ECS mandates?
Section 25 of the Payment and Settlement Systems Act, 2007 provides the same rights and remedies for dishonour of electronic instructions due to insufficient funds as are available under Section 138 of the Negotiable Instruments Act, 1881 for cheque bounce.
What should we do with existing PDC/EMI cheques in ECS locations?
Convert them into ECS/RECS (Debit) by obtaining fresh ECS mandates from customers. Do not retain or use the old cheques.
📜 Read the original circular — full text as issued by RBI
RBI/2013-14/158
DPSS.CO.CHD.No./209/04.07.05/2013-14
July 24, 2013
The Chairman and Managing Director / Chief Executive Officer
All Scheduled Commercial Banks including RRBs /
Urban Co-operative Banks / State Co-operative Banks /
District Central Co-operative Banks/Local Area Banks
Madam / Dear Sir
Migration of Post-dated cheques (PDC)/Equated Monthly Instalment (EMI) Cheques to Electronic Clearing Service (Debit)
We invite a reference to our circular DPSS.CO.CHD.No.1622/04.07.05/2012-13 dated March 18, 2013 wherein all lending banks have been advised not to accept any fresh Post Dated Cheques (PDC)/Equated Monthly Installment (EMI) cheques in locations where the facility of ECS/RECS (Debit) is available and convert existing cheques in such locations into ECS/RECS (Debit) by obtaining fresh mandates.
2. However, instances of banks obtaining fresh cheques (both CTS-2010 and non CTS-2010 standard) in locations where the facility of ECS/RECS is available have been brought to our notice, thus necessitating a reiteration of our earlier instructions in this regard.
3. Accordingly, banks are advised to adhere to the following instructions with immediate effect:
No fresh/additional Post Dated Cheques (PDC)/Equated Monthly Installment (EMI) cheques (either in old format or new CTS-2010 format) shall be accepted in locations where the facility of ECS/RECS (Debit) is available. The existing PDCs/EMI cheques in such locations may be converted into ECS/RECS (Debit) by obtaining fresh ECS (Debit) mandates .
As indicated in our circular DPSS.CO.PD.No.497/02.12.004/2011-12 dated September 21, 2011 , Section 25 of the Payment and Settlement Systems Act, 2007 accords the same rights and remedies to the payee (beneficiary) against dishonor of electronic funds transfer instructions under insufficiency of funds as are available under Section 138 of the Negotiable Instruments Act, 1881. Considering the protection available, there is no need for banks to take additional cheques, if any, from customers in addition to ECS (Debit) mandates.
Cheques complying with CTS-2010 standard formats shall alone be obtained in locations, where the facility of ECS/RECS is not available.
4. The above instructions are issued under section 18 of the Payment and Settlement Systems Act 2007 (Act 51 of 2007).
5. Please acknowledge receipt.
Yours faithfully
(Vijay Chugh)
Chief General Manager
Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2013-14/158 · issued 24 Jul 2013. The plain-English explanation above is BankPulse’s own independent summary.
Communicate these instructions to all branches and loan processing units immediately.
📜 Compliance
Cease acceptance of any fresh PDC or EMI cheques in locations where ECS/RECS (Debit) is available.
Convert existing PDC/EMI cheques in such locations into ECS mandates by obtaining fresh mandates from customers.
Ensure no additional cheques are taken from customers beyond the ECS mandate, leveraging legal protection under PSS Act.
In non-ECS locations, accept only CTS-2010 standard cheques.
Grouped from the action items above — a single circular may involve more than one team.
Worked example & action-note template
Example: if you are a Compliance officer at a bank this circular applies to (All Scheduled Commercial Banks including RRBs, Urban Co-operative Banks, State Co-operative Banks, District Central Co-operative Banks, Local Area Banks), your first concrete step on “RBI Bans Fresh PDC/EMI Cheques Where ECS Available” is: “Cease acceptance of any fresh PDC or EMI cheques in locations where ECS/RECS (Debit) is available.” (RBI issued this 24 Jul 2013).
Circular: RBI/2013-14/158 -- RBI Bans Fresh PDC/EMI Cheques Where ECS Available
Issued: 24 Jul 2013
Action required: Cease acceptance of any fresh PDC or EMI cheques in locations where ECS/RECS (Debit) is available.
Action required: Convert existing PDC/EMI cheques in such locations into ECS mandates by obtaining fresh mandates from customers.
Action required: Ensure no additional cheques are taken from customers beyond the ECS mandate, leveraging legal protection under PSS Act.
Action required: In non-ECS locations, accept only CTS-2010 standard cheques.
Action required: Communicate these instructions to all branches and loan processing units immediately.
Owner: ____________ Target date: ____________
Board/committee approval needed? Y / N
Evidence filed in compliance register on: ____________
Built only from this circular’s own published fields — not legal advice; always confirm against the official RBI source.
💬 Banker Discussion
Discuss this circular with fellow bankers — reply, upvote what helps, report what doesn’t belong. Be professional; no client data. Views are the commenter’s own, not BankPulse’s.
BankPulse Compliance Evidence Pack — generated 03 Aug 2026 · status cross-checked against RBI’s official withdrawal register (refreshed weekly). Official RBI source: https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=8267&Mode=0 — Plain-English summary by BankPulse (bankpulse.ai), reviewed by our expert reviewer, CA Amit Jain. Independent platform, not affiliated with the Reserve Bank of India; is our own plain-English paraphrase, not RBI’s original wording.
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