Essence of Cheque Truncation System toward Efficient Financial Service Delivery in Nigeria

Automated Clearing System on Deposit Money Banks’ Performance: Experience from the Nigerian Banks

“…Cheque clearing, is the process of returning a cheque to the bank where the drawer has an account for verification and collection of the value. In general, every cheque goes through the clearing process, which involves confirming the validity of the instrument before the paying banker assigns value to the cheques [3] .…”

“…The findings of the study revealed that among the channels of e-payment systems, automated cheques have the lowest growth rate. The study investigated the significant effect of cheque truncation system (CTS) in the delivery of efficient financial services in Nigeria [3] . The study used desk research methodolo-gy, reviewing extensive available relevant literature to provide direction to the topic under consideration.…”

“…Following the introduction of the Nigerian Automated Clearing System (NACS) in 2002, which automated the process of cheque clearing, was one significant application of technological innovation in the banking sector. The Bankers Committee initiated the Nigeria Automated Clearing System (NACS) in October 2002 as a mechanism for sorting cheques using the Magnetic Ink Character Recognition (MICR) format [3] . Even after the introduction of the automated cheque clearing system, another cheque clearing system, In 2012, the Cheque Truncation System (CTS) was implemented, which is the process by which physical cheques presented for payment in a bank are converted into an electronic form through scanning and the image is electronically transmitted to the clearing house for processing [3] .…”