The CTS Full Form in Banking is cheque truncation system. Instead of having the physical check processed by the presenting bank before being sent on to the paying bank branch, the cheques can be cleared electronically through a system called the Cheque Truncation System (CTS). The (RBI) has implemented this measure to expedite the clearing of cheques.
History of CTS
In February of 2008, the CTS were introduced for the first time by the RBI in the National Capital Region in New Delhi.
It was first introduced to the public in September of 2011 in Chennai.
In 2013, the Reserve Bank of India (RBI) made the decision that starting August 1, 2013, CTS-2010 cheques would’ve been accepted by banks for clearance. Later, in July of 2013, it was decided to push back the deadline to December 31, 2013.
Benefits of CTSWhat Does Stand For?
- It saves time, money, and effort that would have been needed in the transportation of cheques physically.
- The quicker clearance of the checks leads to improved services provided to the customers.
- The operating efficiency of the banking system is improved as a result.
- It lowers the likelihood of fraud occurring in connection with the clearing of cheques.
- There is no danger of cheques becoming lost in transit.
- There are no limits based on location.