Home › Circulars › RBI/2013-14/472

Ban on Crediting Account Payee Cheques to Third Parties

No longer current — withdrawn, no replacement on file yet
Source: Reserve Bank of India · RBI/2013-14/472 · issued 28 Jan 2014 · ~1 min read
Quick answerRBI reiterates that RRBs, StCBs, and CCBs must not credit 'account payee' cheques to anyone other than the named payee. A limited exception allows crediting up to Rs.50,000 to cooperative credit society customers if the payee is the society's constituent.

What changed

This circular reinforces existing prohibitions from November 2011 on crediting account payee cheques to third parties. It adds no new rules but reminds banks of the strict requirement and the Rs.50,000 threshold exception for cooperative credit societies.

What it means for you

Banks must tighten cheque collection processes to prevent misuse of account payee instruments. The Rs.50,000 cap for cooperative credit societies offers limited operational flexibility but requires careful verification to avoid regulatory breaches.

Historical instruction — do not use for current compliance. This is what was required at the time; it no longer reflects current RBI requirements. If no replacement rule is linked above, that only means none is recorded on our register yet — it does not prove no later applicable rule exists. Confirm on the official RBI source below.

What banks were required to do at the time

Who it affects

Regional Rural Banks (RRBs), State Cooperative Banks (StCBs), Central Cooperative Banks (CCBs), Cooperative credit societies and their customers

❓ Common questions

Regulatory timeline

Built from our lineage records — each fact carries its provenance; missing history simply is not shown (never guessed).

Can we credit an account payee cheque to a third party if the payee authorizes it?

No. The circular strictly prohibits crediting account payee cheques to anyone other than the named payee, regardless of authorization. Only the exception for cooperative credit societies up to Rs.50,000 applies.

What verification is needed for the Rs.50,000 exception for cooperative credit societies?

Banks must confirm that the payee named on the cheque is a constituent of the cooperative credit society and that the cheque amount does not exceed Rs.50,000. Proper documentation and audit trails are essential.

📜 This document’s life story (1 recorded event, each backed by RBI’s own words)
Repealed by RBI/2025-26/100 — Consolidation of Regulations — Withdrawal of circulars (28 Nov 2025)
RBI’s words: “Official withdrawal register entry #952: RPCD.RRB.RCB.BC.No.80/07.51.014/2013-14 — "Collection of Account Payee Cheques - Prohibition on Crediting Proceeds to Third Party Account" dated January 28, 20”
📜 Read the original circular — full text as issued by RBI
RBI/2013-14/472 RPCD.RRB.RCB.BC.No. 80/07.51.014/2013-14 January 28, 2014 The Chairmen / CEOs of All Regional Rural Banks / State and Central Co-operative Banks Dear Sir/Madam, Collection of Account Payee Cheques – Prohibition on Crediting Proceeds to Third Party Account Please refer to our circulars RPCD.CO.RRB.BC.No.30/03.05.33/2011-12 dated November 11, 2011 and RPCD.CO.RCBD.BC.No.34/07.38.03/2011-12 dated November 24, 2011 advising Regional Rural Banks (RRBs) and State / Central Cooperative Banks (StCBs/CCBs) that they are prohibited from crediting 'account payee' cheques to the account of any person other than the payee named therein. We reiterate these instructions and advise that banks should strictly collect ‘account payee’ cheques only for their payee constituents. 2. RRBs and StCBs/CCBs may, however, consider collecting account payee cheques drawn for an amount not exceeding Rs.50,000/- to the account of their customers who are co-operative credit societies, if the payees of such cheques are the constituents of such co-operative credit societies, as advised in our above circulars dated November 11, 2011 and November 24, 2011. Yours faithfully, (A. Udgata) Principal Chief General Manager
Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2013-14/472 · issued 28 Jan 2014. The plain-English explanation above is BankPulse’s own independent summary.
🧰 Tools — save, print, templates & related
Most relevant forBranch Operations (Accounts / FD / CASA)Branch Manager — PSU / Co-op / RRB (sanctioning powers)Teller / Cashier / Customer Service OfficerCompliance TeamInternal AuditPersonal Banker / Branch RM (Portfolio)
🛠 Banker’s toolkit — checklists & reply templates →
Related circulars · Financial Inclusion & Priority Sector
Small Account Rules for Co-operative Banks – RBI Circular 2011RRB CRR Hiked to 9% from Aug 30, 2008CRR Hiked for RRBs by 50 bps in Two StagesRRBs: PMLA Compliance – CTR, STR, and KYC Software MandateRRB CRR Hiked to 8.25% from May 24, 2008
Browse all departments →

💬 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.

Loading comments…
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=8720&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.
Public beta — plain-English informational summaries. Always verify against the official RBI source (circular number cited on every page) before making compliance, credit, treasury, audit, or operational decisions. · Join our WhatsApp channel ↗
—