Check clearing now down to one day

Six years after its inception, the Check Image Clearing System (CICS) is going live, cutting the clearing process to no more than one day.

The central bank and the Philippine Clearing House Corp. (PCHC) on Tuesday signed the memorandum of agreement to put the CICS in operation mode.

"Funds will now be made available for the next banking day — for now — and even shorter in the long run," Bangko Sentral ng Pilipinas (BSP) Governor Amando M. Tetangco Jr. said when the agreement was signed at the central bank complex in Manila.

Tetangco noted some P135 billion worth of checks are transacted daily, highlighting the need for stakeholders of an assurance that payments are being carried out while recipients get a sense of finality in the arrival of funds.

"The BSP recognizes that checks will probably play a very important role. It needs to evolve," he said, noting that the agreement also entails a uniform clearing system for all checks in the country, making transactions more secure.

"We are committed to promoting modernization of payment systems... secure, efficient, and affordable payment systems," Tetangco said.

PCHC Chairman Abraham T. Co said the agreement entails enhancing the security features of checks.

Such changes would mean additional watermarks, and the shift to digital process in clearing checks.

While processing checks will be cut down to one day, the process may actually go shorter in the long-term, said Co.

"Same day clearing is also possible," he said.

BSP Deputy Governor Vicente Aquino noted the initiative was started in October 2010. — VDS, GMA News